India Premium Housing Growth Tests Urban Affordability

India’s housing market is moving towards higher-value homes, with premium housing taking a larger share of sales and new project launches across major cities. The shift is changing how developers allocate land and capital, but it also brings a sharper question for urban India: can cities accommodate rising demand for expensive homes without further narrowing access to reasonably priced housing?

Recent market data shows that this is more than a short-term luxury trend. JLL reported that homes priced above ₹1 crore accounted for 62% of sales across seven major cities in the first quarter of 2026, while sales in the ₹10 million-plus segment rose 30% year on year. Premium projects also accounted for 64% of new launches during the quarter. The movement towards premium housing reflects several changes in urban demand. Higher household incomes, greater demand for larger homes, improved connectivity and interest in better amenities are encouraging buyers with purchasing capacity to move towards more expensive properties. The trend is particularly visible in large metropolitan markets where land values and construction costs have risen sharply. For developers, the economics are significant. Higher-value projects can generate greater revenue from fewer units, making premium development attractive when land, labour and material costs remain elevated.

JLL’s 2026 assessment found that premium apartments above ₹10 million continued to gain market share even as overall housing volumes moderated in 2025. However, the shift also exposes a widening affordability challenge. Knight Frank data showed that homes above ₹1 crore made up half of residential sales across India’s top eight cities in 2025, while transactions below ₹50 lakh declined 17% year on year. A market increasingly driven by high-ticket transactions can remain financially strong while becoming less accessible to middle-income households. This makes RERA relevant beyond project registration and buyer protection. The Real Estate (Regulation and Development) Act requires covered projects to be registered before they are marketed or sold and provides for public disclosure of project information. Its framework is designed to improve transparency, accountability and consumer protection.

For cities, the larger issue is what accompanies premium development. New housing must be matched by adequate roads, public transport, water supply, drainage, waste management, open spaces and energy-efficient infrastructure. Without that balance, high-value construction can intensify pressure on already strained urban systems. The premiumisation of Indian housing is therefore likely to remain an important source of real estate value growth. The next phase will test whether market expansion can be matched by transparent RERA compliance, sound infrastructure planning and a broader housing mix that keeps Indian cities economically productive and liveable for a wider population.

Also Read: Pune RERA Standards Meet New Buyer Transparency Push

India Premium Housing Growth Tests Urban Affordability