The individual housing finance market, which is valued at ₹33 trillion, is estimated to grow at a compounded annual growth rate (CAGR) of 15-16 per cent between 2024-2025 and 2029-2030 to ₹77-81 trillion with home buyers flocking to new projects.
Between 2020-21 and 2023-24, banks have grown at a CAGR of 17 per cent in the housing loan space, while housing finance companies (HFCs) have grown 12 per cent.
Even as banks continued to dominate the housing loan market (share of 74.5 per cent as of March 31, 2024), according to CareEdge Ratings, both banks and HFCs have space to grow. The market share of HFCs at around 19 per cent as of March 31, 2024, is expected to continue.
“HFCs primarily operate in ticket sizes of less than ₹30 lakh, which accounted for 53 per cent of total assets under management (AUM) as of March 2024. However, there is a gradual rise in the proportion of AUM with ticket sizes ranging between ₹30-50 lakh. This aligns with the premiumisation trend,” said Geeta Chainani, associate director, CareEdge Ratings.
Real estate consulting firm Anarock said that over 42 per cent of approximately 4.60 lakh homes sold in 2024 was in new projects — up from pre-pandemic 2019’s sales share of 26 per cent of approximately 2.61 lakh homes sold then.
At 53 per cent each, Bangalore and Chennai saw the highest share of new supply absorption in 2024, while absorption of launches in Calcutta was 31 per cent.
