Report Overview

India Housing Loans Market – Industry Trends & Forecast Report, 2031

India Housing Loans Market size was estimated at USD 417.81 billion in 2024. During the forecast period between 2025 and 2031, India Housing Loans Market size is projected to grow at a CAGR of 14% reaching a value of USD 1,045.49 billion by 2031. Prominent drivers of the market include rapid urbanization, rising disposable incomes, and government initiatives like Pradhan Mantri Awas Yojana (PMAY), which enhance housing finance accessibility. To mitigate the economic impact of the pandemic, the Reserve Bank of India (RBI) implemented repo rate cuts, leading to lower home loan interest rates and making borrowing more affordable. Additionally, government relief measures supported the housing sector through liquidity provisions, extended project deadlines, and temporary stamp duty reductions in select states. With India’s goal of becoming a USD 5 trillion economy, the housing loan market is expected to double over the next five years. Interest rates, typically ranging from 6% to 10%, vary based on factors like loan amount, tenure, and borrower creditworthiness. The rise of digital lending platforms has further streamlined the loan application process, offering borrowers tools for eligibility assessment, EMI calculation, and rate comparisons. With continued government support and technological advancements, India's housing finance sector is expected for sustained expansion.

Housing Loans – Overview

A housing loan, or home loan, is a financial product that helps individuals purchase, construct, or renovate residential property. Offered by banks and financial institutions, it is repaid through equated monthly installments (EMIs) with fixed or floating interest rates. The property itself serves as collateral. Housing loans include home purchase, construction, renovation, and extension loans, with tenures ranging from 5 to 30 years, depending on the borrower’s income, credit history, and eligibility. These loans make homeownership more accessible by allowing borrowers to spread payments over time while benefiting from tax incentives in many countries.

India Housing Loans Market

Growth Drivers

Growth in Affordable Housing Segment

India Housing Loan Market has witnessed a significant rise in affordable housing, driven by government initiatives and market trends. In FY2022, housing affordability remained at 3.2, the lowest since 2011, making homeownership more accessible. The Pradhan Mantri Awas Yojana (PMAY), particularly its Credit-Linked Subsidy Scheme (CLSS), has provided interest subsidies to economically weaker sections (EWS), lower income groups (LIGs), and middle income groups (MIGs), enhancing affordability. Additionally, tax benefits on home loans reduce borrowing costs, while lenders offer tailored products with competitive rates and relaxed criteria. Developers are expanding affordable housing projects across tier 2 and 3 cities, aided by technological advancements like prefabricated construction, further improving cost efficiency.

Challenges

Rising Property Prices

Rising property prices could restrain the growth India Housing Loans Market, making homeownership unaffordable, especially in metro cities like Mumbai. While tax benefits offer relief, experts urge reforms like higher deduction limits and extended affordable housing incentives. Government schemes such as PMAY and MHADA primarily benefit lower-income groups, leaving the middle class struggling. Infrastructure projects further drive up prices, while rising interest rates and stringent lending norms add financial strain. Developers focusing on luxury housing worsen affordability. Addressing these challenges requires policy interventions, including increased tax benefits, expanded affordable housing supply, and financial support to ensure accessible housing loans.

Impact of Escalating Geopolitical Tensions on India Housing Loans Market

Escalating geopolitical tensions could adversely affect India Housing Loans Market by driving economic uncertainties, inflation, and fluctuating interest rates. Supply chain disruptions can increase construction costs, rising property prices and make homeownership less affordable. Investors may adopt a cautious approach, leading to reduced liquidity and stricter lending norms. Rising fuel and commodity prices due to global conflicts could further strain household finances, affecting loan repayment capacity. Additionally, currency fluctuations may impact foreign investments in the real estate sector. To mitigate these risks, policy measures such as interest subsidies and affordable housing schemes are crucial in ensuring housing loan accessibility despite geopolitical instability.

India Housing Loans Market

Segmental Coverage

India Housing Loans Market – By Loan Type

Based on loan type, India Housing Loans Market is divided into Home Purchase Loans, Home Construction Loans, Home Improvement Loans, Home Extensions Loans, Balance Transfer Loans, and Top-Up Home Loans segments. The home purchase loans segment holds the highest share in India Housing Loans Market by loan type. It is driven by rapid urbanization, rising disposable incomes, and a strong aspiration for homeownership, particularly among the middle class. A survey revealed that 79% of urban homebuyers prefer home loans, citing factors like location, affordability, and financing flexibility as key considerations. Demand has surged in metropolitan areas and Tier 2 and Tier 3 cities, supported by government initiatives like Pradhan Mantri Awas Yojana (PMAY). Banks and Housing Finance Companies (HFCs) enhance accessibility with competitive interest rates and digital lending platforms. With strong demand from first-time buyers and upgraders, home purchase loans continue to lead India's housing finance sector.

India Housing Loans Market – By Property Type

India Housing Loans Market by property type is divided into Affordable Housing, Luxury Housing, Independent House & Villas, and Apartments & Flats segments. The affordable housing segment holds the highest share in India Housing Loans Market by property type, driven by strong government support, rising demand for budget-friendly homes, and initiatives like the Pradhan Mantri Awas Yojana Urban 2.0 (PMAY-U 2.0), which provide financial assistance and interest subsidies to enhance homeownership accessibility for lower and middle-income groups. Housing finance companies (HFCs) and scheduled commercial banks (SCBs) play a crucial role in catering to this segment, offering affordable financing solutions to meet growing demand, with a significant share of housing loans in India allocated to affordable housing. Urbanization and population growth further amplify this demand, necessitating millions of new affordable housing units, while the government’s consistent focus on financial inclusion and housing accessibility strengthens the segment’s market dominance, positioning affordable housing as the primary driver shaping the future of the India Housing Loans Market. Top of FormBottom of Form

India Housing Loans Market – By Customer Type

On the basis of customer type, India Housing Loans Market is segmented into Salaried Individuals, Self-Employed Professionals, Low Income Groups (LIG), and High Net Worth Individuals (HNIs) segments.  Top of FormBottom of Form

India Housing Loans Market – By Region

The in-depth research report on India Housing Loans Market covers the market in the country’s major regions: North India, South India, East India, and West India regions. North India region holds the highest share in India Housing Loans Market and is expected to maintain dominance during the forecast period. It is driven by major cities like Delhi, Gurugram, Noida, and Chandigarh, which benefit from rapid urbanization, real estate expansion, and a growing middle class. Government initiatives such as the Pradhan Mantri Awas Yojana (PMAY) have played a crucial role in promoting affordable housing and improving loan accessibility. Additionally, strong employment prospects in industries and the IT sector continue to attract migrants, boosting housing demand. The presence of established banks and Housing Finance Companies (HFCs) offering competitive loan options further reinforces this trend. With increasing consumer preference for homeownership, the North region remains the dominant force in India's housing loan market.

Competitive Landscape

Major players operating in India Housing Loans Market include HDFC Bank, State Bank of India (SBI), IIFL Housing Finance Limited, LIC Housing Finance Limited, GIC Housing Finance Limited, Sundaram Home Finance, Indiabulls Housing Finance Limited, Tata Capital Housing Finance Limited, Cholamandalam Housing Finance, L&T Housing Finance Limited, Dewan Housing Finance Limited (DHFL), Repco Home Finance, PNB Housing Finance Limited, and India Home Loan Limited. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In September 2024 - Godrej Group’s financial services arm, Godrej Capital announced its plans to enter the affordable housing loan segment.

Scope of the Report

By Loan Type

• Home Purchase Loans

• Home Construction Loans

• Home Improvement Loans

• Home Extensions Loans

• Balance Transfer Loans

• Top-Up Home Loans

By Property Type

• Affordable Housing

• Luxury Housing

• Independent House & Villas

• Apartments & Flats

By Customer Type

• Salaried Individuals

• Self-Employed Professionals

• Low Income Groups (LIG)

• High Net Worth Individuals (HNIs)

By Region

• North India

• South India

• East India

• West India

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. India Housing Loans Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Rapid Urbanization & Infrastructure Development
         2. Government Initiatives and Subsidies
         3. Growth in Affordable Housing Segment
      2. Restraints
         1. Rising Property Prices
      3. Opportunities
         1. Digitalization of Lending Processes
         2. Expansion in Tier-II and Tier-III Cities
      4. Challenges
         1. Rising Non-Performing Assets (NPAs)
         2. Regulatory Changes and Compliance Issues
   3. Technological Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. India Housing Loans Market: Marketing Strategies
5. India Housing Loans Market: Pricing Analysis
6. India Housing Loans Market Overview
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Loan Type
         1. Home Purchase Loans
         2. Home Construction Loans
         3. Home Improvement Loans
         4. Home Extensions Loans
         5. Balance Transfer Loans
         6. Top-Up Home Loans
      2. By Property Type
         1. Affordable Housing
         2. Luxury Housing
         3. Independent House & Villas
         4. Apartments & Flats
      3. By Customer Type
         1. Salaried Individuals
         2. Self-Employed Professionals
         3. Low-Income Groups
         4. High-Net-Worth Individuals
      4. By Region
         1. North India
         2. South India
         3. East India
         4. West India
7. North India Housing Loans Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Loan Type
      2. By Property Type
      3. By Customer Type
8. South India Housing Loans Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Loan Type
      2. By Property Type
      3. By Customer Type
9. East India Housing Loans Market
   1. Market Size & Forecast, 2019–2031
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Loan Type
      2. By Property Type
      3. By Customer Type
10. West India Housing Loans Market
    1. Market Size & Forecast, 2019–2031
       1. By Value (USD Billion)
    2. Market Share & Forecast
       1. By Loan Type
       2. By Property Type
       3. By Customer Type
11. Competitive Landscape
    1. List of Key Players and Their Offerings
    2. India Housing Loans Company Market Share Analysis, 2024
    3. Competitive Benchmarking, By Operation Channel Parameters
    4. Key Strategic Development (Mergers, Acquisitions, Partnerships, etc.)
12. Impact of Escalating Geopolitical Tensions on India Housing Loans Market
13. Company Profiles (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, SWOT Analysis)
    1. HDFC Bank
    2. State Bank of India
    3. IIFL Housing Finance Limited
    4. LIC Housing Finance Limited
    5. GIC Housing Finance Limited
    6. Sundaram Home Finance
    7. Indiabulls Housing Finance Limited
    8. Tata Capital Housing Finance Limited
    9. Cholamandalam Housing Finance
    10. L&T Housing Finance Limited
    11. Dewan Housing Finance Limited (DHFL)
    12. Repco Home Finance
    13. PNB Housing Finance Limited
    14. India Home Loan Limited
    15. Other Prominent Players
14. Key Strategic Recommendations
15. Research Methodology
    1. Qualitative Research
       1. Primary & Secondary Research
    2. Quantitative Research
    3. Market Breakdown & Data Triangulation
       1. Secondary Research
       2. Primary Research
    4. Breakdown of Primary Research Respondents, By Region
    5. Assumption & Limitation

*Financial information of non-listed companies will be provided as per availability

**The segmentation and the companies are subjected to modifications based on in-depth secondary for the final deliverable

List of Figures

Figure 1       India Housing Loans Market Segmentation

Figure 2       India Housing Loans Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2024

Figure 4       India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Figure 5       India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Figure 6       India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Figure 7       India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Figure 8       India Housing Loans Market Share, By Region, By Value (USD Billion) 2019–2031

Figure 9       North India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Figure 10     North India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Figure 11     North India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Figure 12     North India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Figure 13     South India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Figure 14     South India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Figure 15     South India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Figure 16     South India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Figure 17     East India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Figure 18     East India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Figure 19     East India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Figure 20     East India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Figure 21     West India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Figure 22     West India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Figure 23     West India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Figure 24     West India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

List of Tables      

Table 1        India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Table 2        India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Table 3        India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Table 4        India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Table 5        India Housing Loans Market Share, By Region, By Value (USD Billion) 2019–2031

Table 6        North India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Table 7        North India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Table 8        North India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Table 9        North India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Table 10      South India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Table 11      South India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Table 12      South India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Table 13      South India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Table 14      East India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Table 15      East India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Table 16      East India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Table 17      East India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Table 18      West India Housing Loans Market Size, By Value (USD Billion), 2019–2031

Table 19      West India Housing Loans Market Share, By Loan Type, By Value (USD Billion) 2019–2031

Table 20      West India Housing Loans Market Share, By Property Type, By Value (USD Billion) 2019–2031

Table 21      West India Housing Loans Market Share, By Customer Type, By Value (USD Billion) 2019–2031

Table 22      HDFC Bank Company Overview

Table 23      HDFC Bank Financial Overview

Table 24      State Bank of India (SBI) Company Overview

Table 25      State Bank of India (SBI) Financial Overview

Table 26      IIFL Housing Finance Limited Company Overview

Table 27      IIFL Housing Finance Limited Financial Overview

Table 28      LIC Housing Finance Limited Company Overview

Table 29      LIC Housing Finance Limited Financial Overview

Table 30      GIC Housing Finance Limited Company Overview

Table 31      GIC Housing Finance Limited Financial Overview

Table 32      Sundaram Home Finance Company Overview

Table 33      Sundaram Home Finance Financial Overview

Table 34      Indiabulls Housing Finance Limited Company Overview

Table 35      Indiabulls Housing Finance Limited Financial Overview

Table 36      Tata Capital Housing Finance Limited Company Overview

Table 37      Tata Capital Housing Finance Limited Financial Overview

Table 38      Cholamandalam Housing Finance Company Overview

Table 39      Cholamandalam Housing Finance Financial Overview

Table 40      L&T Housing Finance Limited Company Overview

Table 41      L&T Housing Finance Limited Financial Overview

Table 42      Dewan Housing Finance Limited (DHFL) Company Overview

Table 43      Dewan Housing Finance Limited (DHFL) Financial Overview

Table 44      Repco Home Finance Company Overview

Table 45      Repco Home Finance Financial Overview

Table 46      PNB Housing Finance Limited Company Overview

Table 47      PNB Housing Finance Limited Financial Overview

Table 48      India Home Loan Limited Company Overview

Table 49      India Home Loan Limited Financial Overview