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    Affordable housing finance segment to grow to Rs 6 lakh crore by FY22: Ind-Ra

    affordable housing
    Affordable housing

    The affordable housing finance segment is likely to grow to Rs 6 lakh crore in size in the next four years from Rs 1.5 trillion now, India Ratings said. Currently, the affordable housing AUM is around Rs 1.5 trillion.

    This will make the segment a major contributor to the overall housing finance activity.

    Affordable housing finance, largely dealing in loan ticket size of up to Rs 15 lakh, will become a large segment for housing finance companies (HFCs) in the next five years, with its market share estimated to increase to around 37 per cent in FY2022, the rating agency said.

    The accelerated urbanization on account of fast economic growth over the last decade-and-a-half has created massive need for affordable housing, it said. 

    The agency anticipates a demand for 25 million homes, which is nearly four times of the entire current housing finance stock, over FY17-FY22 in the medium and lower income group categories. 

    A combination of factors like the government’s financial and policy thrust, regulatory support, rising urbanisation, increasing nuclearisation of families and increasing affordability is converting latent demand into a commercially lucrative business opportunity, it said.
    Ind-Ra expects the sector to attract over Rs 200 billion of equity inflows over FY17-FY22 which would support growth.

    Image source: The GenX Times


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