Housing Loans in India Reach ₹33.53 Lakh Crore, Growing 14% Year-on-Year
September 2024 Report by the National Housing Bank Highlights Positive Growth Amidst Regional Disparities
As of the end of September 2024, outstanding housing loans in India reached an impressive ₹33.53 lakh crore, marking a substantial year-on-year growth of 14%. The report, released by the National Housing Bank (NHB), highlighted the Middle-Income Group (MIG) segment as the largest contributor to this growth, accounting for 44% of total individual housing loans.
Positive Outlook for the Housing Sector
The NHB report outlines a favorable outlook for the housing sector, largely fueled by various government initiatives such as the Pradhan Mantri Awas Yojana 2.0, ongoing urbanization, and advancements in digitization. These factors are not only expected to support the current growth but also pave the way for future enhancements in housing finance accessibility.
“As on September 30, 2024, the distribution of outstanding individual housing loans was as follows: Economically Weaker Sections (EWS) and Low-Income Groups (LIG) made up 39%, while the High-Income Group (HIG) represented the remaining 17%,” the report stated.
According to the NHB data, the total disbursement of individual housing loans during the second half of the financial year ending September 2024 was ₹4.10 lakh crore, building on the annual figure of ₹9.07 lakh crore recorded for the previous fiscal year.
Initiatives Supporting Housing Growth
The report emphasized several major government initiatives that continue to shape the housing landscape. Programs such as the Pradhan Mantri Awas Yojana Gramin (PMAY-G), Pradhan Mantri Awas Yojana Urban (PMAY-U), and the Urban Infrastructure Development Fund (UIDF) were highlighted for their impact on housing availability and affordability.
In addition, the Affordable Rental Housing Complexes (ARHC) scheme has been acknowledged for addressing the housing needs of lower-income populations.
Challenges Facing the Housing Sector
Despite the positive data, the report noted significant regional disparities in credit distribution. Southern, Western, and Northern states accounted for 35.02%, 30.14%, and 28.73% of cumulative disbursements, respectively, while Eastern states, including the Northeast, lagged behind with only 6.10%. Alarmingly, the Northeast alone captured just 0.68% of the total individual housing loan disbursements during the first half of FY 2024-25. Moreover, the report raised concerns regarding the housing sector’s vulnerability to climate-related risks such as floods, fires, and other extreme weather events. There is an increasing necessity to improve building resilience and energy efficiency, alongside tackling the costs associated with green construction materials.
Technological Advances
Technological advancements, particularly in construction and the digitization of land records, are viewed as critical enablers for the housing sector’s growth. As stakeholders look to the future, the need for more institutions providing green building certifications has become apparent, as well as the need for standardized rating certifications across different agencies.
Perspectives from Industry Experts
Industry leaders have weighed in on the findings of the NHB report. Ashok Kapur, chairman of Krishna Group and Krisumi Corporation, expressed optimism, stating, “India’s housing sector is on a strong growth path, fueled by rising homeownership aspirations, rapid urban expansion, and supportive policies.” He emphasized the report’s findings that indicate an ongoing increase in individual housing loans and a steady rise in home prices.
Pradeep Aggarwal, founder and chairman of Signature Global (India) Ltd, noted the significance of the MIG segment, reaffirming that this demographic is rapidly becoming the backbone of the housing sector. “This segment is growing rapidly, driven by urbanization, increasing incomes, and supportive government policies, reflecting a strong desire for homeownership,” he commented.
Conclusion
The NHB report paints a hopeful picture for the future of housing in India, driven by growing aspirations for homeownership and key government initiatives. While challenges remain, particularly in addressing regional disparities and climate vulnerabilities, the positive growth trajectory suggests a robust outlook for stakeholders in the housing finance market.
Share this article:
