Affordable Housing: A Marketing Gimmick?

Despite of the hike in property prices, the market absorption of luxury homes are more compared to affordable housing. This year around 1,241 and 1,083 affordable units have been launched between January and February, respectively, whereas, the luxury segment has witnessed the launch of around 4,816 and 3,821 units in the same period.

Also, developers who had launched homes under affordable category now have made their shift to premium housing projects, according to a inside source.

Low profit margins in affordable projects have make developers to make their shift from affordable to luxury, said experts.

Samir Jasuja, founder & CEO, PropEquity, explained that "There has been a fundamental demand for affordable housing in India owing to the presence of a large low- and middle-income group. Tier II and Tier III cities witness a comparatively higher supply of affordable housing as compared to Tier I cities. High cost of land poses a challenge to developers to launch such projects in the central parts of the city. That is why, most of the affordable projects in Tier I cities would be found in peripheral areas."

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