Has Indian real estate become too expensive? CREDAI president weighs in
Property prices have surged across major Indian cities over the past three years, sparking concerns about affordability and fears of a potential housing bubble. But CREDAI President Shekhar G Patel says the market continues to be driven by genuine end-user demand and long-term structural factors rather than speculative excess.
- Jun 13, 2026,
- Updated Jun 13, 2026 8:05 AM IST
India's residential real estate market has witnessed a sharp rise in property prices over the past few years, raising questions around affordability, luxury housing demand, project execution and the sustainability of the current upcycle. In an interaction with Business Today, Shekhar G Patel, President of CREDAI (Confederation of Real Estate Developers' Associations of India) shared his views on pricing, supply trends, homebuyer demand, regulatory reforms, infrastructure-led growth and the sector's long-term outlook. Read the edited excerpts:
BT: Property prices across major cities have risen sharply over the last three years, while income growth has been far more modest. Has Indian real estate become disconnected from household affordability, and do you see a risk of pricing out genuine homebuyers?
Patel: The larger issue today is not demand. The larger issue is affordability in certain segments, particularly for first-time homebuyers and middle-income households. Property prices have certainly moved up across major cities, but they have done so alongside rising land costs, construction expenses, financing costs and compliance-related charges. At the same time, buyers are increasingly seeking better infrastructure, larger homes and more integrated developments, which has also influenced pricing across many markets.
What is important to recognise is that homeownership demand remains fundamentally strong. Across cities, we continue to see end-users driving the market, supported by rising aspirations, wealth creation and long-term confidence in real estate as an asset class. Going forward, the focus should be on ensuring that affordability remains aligned with current market realities. Housing policies and definitions need to evolve alongside changing costs so that homeownership opportunities continue to remain accessible to a wider section of buyers.
BT: Developers continue to launch new projects aggressively, particularly in the premium, luxury and ultra-luxury segment, but several cities still carry substantial unsold inventory. Are developers prioritising sales momentum and valuations over actual demand absorption, and could this create oversupply risks in the next cycle?
Patel: The positive difference today is that the sector is operating with far greater discipline. Developers are no longer launching projects based purely on future expectations. Regulatory reforms, stronger financial oversight and more informed homebuyers have fundamentally changed the way supply decisions are being made. Launches today are increasingly linked to demonstrated demand and market absorption.
The premium and luxury segments have attracted substantial supply because that is where demand has been particularly strong. We are seeing homebuyers upgrade their housing choices and place greater value on quality, amenities and location advantages. That said, real estate remains highly localised. Certain micro-markets may require careful supply calibration from time to time. However, at a broader level, the market today is significantly more data-driven and financially disciplined, which reduces the likelihood of broad-based oversupply risks.
BT: Luxury and ultra-luxury housing have become the biggest growth drivers in many markets. Is the industry becoming overly dependent on affluent buyers while neglecting the mass housing segment, which represents India's real housing demand? Also, do you think AI-led disruption may squeeze demand in the space?
Patel: Luxury housing may be driving headlines, but it is not driving the entire housing market. India's housing story continues to be shaped by demand across multiple segments, particularly among middle-income and aspiring homebuyers. In fact, the underlying demand for affordable and mid-income housing remains extremely strong across most urban markets. The real discussion today is not about demand. It is about ensuring that housing supply remains viable at price points that are accessible to a larger section of buyers. As development costs have increased over the years, this has become an increasingly important area of policy focus.
As far as artificial intelligence is concerned, it is more likely to transform how real estate is planned, built and managed than alter the underlying demand for housing. India's housing demand continues to be supported by urbanisation, household formation and long-term homeownership aspirations. Those structural drivers remain firmly in place.
BT: Real estate contributes significantly to India's GDP and employment, but it is also a major consumer of land, capital and credit, while being a major contributor to employment directly and indirectly. How do you respond to concerns that the sector may not generate sufficient employment in the current volatile economic scenario?
Patel: The employment impact of real estate is often viewed too narrowly through the lens of construction activity alone. In reality, real estate supports a much larger economic ecosystem that includes manufacturing, logistics, financial services, engineering, architecture and a wide range of allied industries. What makes the sector particularly important is its multiplier effect. Every housing project, office development, industrial park or infrastructure-linked development creates economic activity across multiple sectors and generates both direct and indirect employment.
While economic volatility can influence investment decisions in the short term, India's long-term urbanisation trajectory remains intact. Cities continue to expand, infrastructure investment continues to accelerate, and demand for housing, commercial spaces and logistics facilities continues to grow. These trends create a strong foundation for sustained employment generation. Technology and AI will improve efficiency across the sector, but they are also expected to create new opportunities in design, project management, data analytics and specialised construction services. Real estate will continue to remain an important contributor to India's growth and employment story.
BT: Homebuyers increasingly pay premium prices based on promised infrastructure projects, but many of these projects face delays. Should developers bear greater accountability when infrastructure-linked promises fail to materialise on time?
Patel: Infrastructure-led development has become one of the defining features of India's urban growth story. Across the country, metro networks, expressways, airports and other connectivity projects are creating entirely new growth corridors and reshaping real estate demand patterns.
Homebuyers are therefore justified in considering future infrastructure while making purchase decisions. Equally, developers have a responsibility to communicate infrastructure-linked opportunities accurately and responsibly. At the same time, large infrastructure projects are long-term undertakings involving multiple stakeholders and implementation phases. Their impact on real estate should be viewed in the context of long-term value creation rather than short-term timelines alone.
The focus going forward should be on greater transparency and information sharing so that homebuyers have realistic visibility into project progress and development timelines. Better coordination across stakeholders will ultimately strengthen buyer confidence and support more informed decision-making.
BT: Despite RERA, project delays, litigation and customer grievances remain common. What specific reforms would CREDAI like to see, and what responsibility should developers themselves take to improve trust in the sector?
Patel: The most important change brought about by RERA is that it has fundamentally improved transparency and accountability across the real estate sector. The market today is significantly more structured and consumer-focused than it was a decade ago. As the sector continues to mature, the next phase of reform should focus on improving efficiency across the project lifecycle. Faster approvals, wider adoption of single-window clearance, and greater coordination across regulatory processes can further strengthen project execution and delivery timelines.
CREDAI has consistently supported reforms that simplify procedures, improve ease of doing business and create a more predictable development environment. Such measures ultimately benefit developers, homebuyers and the broader economy alike.
At the same time, developers must continue strengthening governance standards, financial discipline and customer engagement. Trust is built through consistent execution, transparent communication and timely delivery, and these remain central to the industry's long-term growth.
BT: Many industry leaders argue that India is in the early stages of a long-term real estate upcycle. Yet valuations in some micro-markets have risen 40–70% in a short period. What indicators convince you that this is structural demand rather than the beginning of another property bubble?
Patel: If this were a speculative cycle, the market would be displaying very different characteristics from what we are seeing today. The defining feature of the current market is the strength of end-user demand. A significant share of purchases is being driven by homebuyers seeking self-occupation, lifestyle upgrades and long-term wealth creation rather than short-term trading opportunities.
The sector is also benefiting from structural drivers that continue to support demand across multiple cities. Urbanisation, infrastructure expansion, rising incomes and strong homeownership aspirations are creating a broad foundation for housing demand.
Another important difference is the level of financial discipline within the sector. Developers today are far more focused on absorption, inventory management and execution than in previous cycles. While individual micro-markets always require careful monitoring, the broader indicators suggest a market that is being supported by genuine demand and long-term fundamentals rather than speculative excess.
MUST READ: After Adani, Ambani joins the race for Mumbai's biggest redevelopment projects
DID YOU KNOW: ₹7 crore as rent! Shreyas Iyer signs 3-year deal for a luxury apartment in Worli
MUST READ: West Asia conflict puts record 5.4 lakh housing deliveries at risk in 2026: Report
India's residential real estate market has witnessed a sharp rise in property prices over the past few years, raising questions around affordability, luxury housing demand, project execution and the sustainability of the current upcycle. In an interaction with Business Today, Shekhar G Patel, President of CREDAI (Confederation of Real Estate Developers' Associations of India) shared his views on pricing, supply trends, homebuyer demand, regulatory reforms, infrastructure-led growth and the sector's long-term outlook. Read the edited excerpts:
BT: Property prices across major cities have risen sharply over the last three years, while income growth has been far more modest. Has Indian real estate become disconnected from household affordability, and do you see a risk of pricing out genuine homebuyers?
Patel: The larger issue today is not demand. The larger issue is affordability in certain segments, particularly for first-time homebuyers and middle-income households. Property prices have certainly moved up across major cities, but they have done so alongside rising land costs, construction expenses, financing costs and compliance-related charges. At the same time, buyers are increasingly seeking better infrastructure, larger homes and more integrated developments, which has also influenced pricing across many markets.
What is important to recognise is that homeownership demand remains fundamentally strong. Across cities, we continue to see end-users driving the market, supported by rising aspirations, wealth creation and long-term confidence in real estate as an asset class. Going forward, the focus should be on ensuring that affordability remains aligned with current market realities. Housing policies and definitions need to evolve alongside changing costs so that homeownership opportunities continue to remain accessible to a wider section of buyers.
BT: Developers continue to launch new projects aggressively, particularly in the premium, luxury and ultra-luxury segment, but several cities still carry substantial unsold inventory. Are developers prioritising sales momentum and valuations over actual demand absorption, and could this create oversupply risks in the next cycle?
Patel: The positive difference today is that the sector is operating with far greater discipline. Developers are no longer launching projects based purely on future expectations. Regulatory reforms, stronger financial oversight and more informed homebuyers have fundamentally changed the way supply decisions are being made. Launches today are increasingly linked to demonstrated demand and market absorption.
The premium and luxury segments have attracted substantial supply because that is where demand has been particularly strong. We are seeing homebuyers upgrade their housing choices and place greater value on quality, amenities and location advantages. That said, real estate remains highly localised. Certain micro-markets may require careful supply calibration from time to time. However, at a broader level, the market today is significantly more data-driven and financially disciplined, which reduces the likelihood of broad-based oversupply risks.
BT: Luxury and ultra-luxury housing have become the biggest growth drivers in many markets. Is the industry becoming overly dependent on affluent buyers while neglecting the mass housing segment, which represents India's real housing demand? Also, do you think AI-led disruption may squeeze demand in the space?
Patel: Luxury housing may be driving headlines, but it is not driving the entire housing market. India's housing story continues to be shaped by demand across multiple segments, particularly among middle-income and aspiring homebuyers. In fact, the underlying demand for affordable and mid-income housing remains extremely strong across most urban markets. The real discussion today is not about demand. It is about ensuring that housing supply remains viable at price points that are accessible to a larger section of buyers. As development costs have increased over the years, this has become an increasingly important area of policy focus.
As far as artificial intelligence is concerned, it is more likely to transform how real estate is planned, built and managed than alter the underlying demand for housing. India's housing demand continues to be supported by urbanisation, household formation and long-term homeownership aspirations. Those structural drivers remain firmly in place.
BT: Real estate contributes significantly to India's GDP and employment, but it is also a major consumer of land, capital and credit, while being a major contributor to employment directly and indirectly. How do you respond to concerns that the sector may not generate sufficient employment in the current volatile economic scenario?
Patel: The employment impact of real estate is often viewed too narrowly through the lens of construction activity alone. In reality, real estate supports a much larger economic ecosystem that includes manufacturing, logistics, financial services, engineering, architecture and a wide range of allied industries. What makes the sector particularly important is its multiplier effect. Every housing project, office development, industrial park or infrastructure-linked development creates economic activity across multiple sectors and generates both direct and indirect employment.
While economic volatility can influence investment decisions in the short term, India's long-term urbanisation trajectory remains intact. Cities continue to expand, infrastructure investment continues to accelerate, and demand for housing, commercial spaces and logistics facilities continues to grow. These trends create a strong foundation for sustained employment generation. Technology and AI will improve efficiency across the sector, but they are also expected to create new opportunities in design, project management, data analytics and specialised construction services. Real estate will continue to remain an important contributor to India's growth and employment story.
BT: Homebuyers increasingly pay premium prices based on promised infrastructure projects, but many of these projects face delays. Should developers bear greater accountability when infrastructure-linked promises fail to materialise on time?
Patel: Infrastructure-led development has become one of the defining features of India's urban growth story. Across the country, metro networks, expressways, airports and other connectivity projects are creating entirely new growth corridors and reshaping real estate demand patterns.
Homebuyers are therefore justified in considering future infrastructure while making purchase decisions. Equally, developers have a responsibility to communicate infrastructure-linked opportunities accurately and responsibly. At the same time, large infrastructure projects are long-term undertakings involving multiple stakeholders and implementation phases. Their impact on real estate should be viewed in the context of long-term value creation rather than short-term timelines alone.
The focus going forward should be on greater transparency and information sharing so that homebuyers have realistic visibility into project progress and development timelines. Better coordination across stakeholders will ultimately strengthen buyer confidence and support more informed decision-making.
BT: Despite RERA, project delays, litigation and customer grievances remain common. What specific reforms would CREDAI like to see, and what responsibility should developers themselves take to improve trust in the sector?
Patel: The most important change brought about by RERA is that it has fundamentally improved transparency and accountability across the real estate sector. The market today is significantly more structured and consumer-focused than it was a decade ago. As the sector continues to mature, the next phase of reform should focus on improving efficiency across the project lifecycle. Faster approvals, wider adoption of single-window clearance, and greater coordination across regulatory processes can further strengthen project execution and delivery timelines.
CREDAI has consistently supported reforms that simplify procedures, improve ease of doing business and create a more predictable development environment. Such measures ultimately benefit developers, homebuyers and the broader economy alike.
At the same time, developers must continue strengthening governance standards, financial discipline and customer engagement. Trust is built through consistent execution, transparent communication and timely delivery, and these remain central to the industry's long-term growth.
BT: Many industry leaders argue that India is in the early stages of a long-term real estate upcycle. Yet valuations in some micro-markets have risen 40–70% in a short period. What indicators convince you that this is structural demand rather than the beginning of another property bubble?
Patel: If this were a speculative cycle, the market would be displaying very different characteristics from what we are seeing today. The defining feature of the current market is the strength of end-user demand. A significant share of purchases is being driven by homebuyers seeking self-occupation, lifestyle upgrades and long-term wealth creation rather than short-term trading opportunities.
The sector is also benefiting from structural drivers that continue to support demand across multiple cities. Urbanisation, infrastructure expansion, rising incomes and strong homeownership aspirations are creating a broad foundation for housing demand.
Another important difference is the level of financial discipline within the sector. Developers today are far more focused on absorption, inventory management and execution than in previous cycles. While individual micro-markets always require careful monitoring, the broader indicators suggest a market that is being supported by genuine demand and long-term fundamentals rather than speculative excess.
MUST READ: After Adani, Ambani joins the race for Mumbai's biggest redevelopment projects
DID YOU KNOW: ₹7 crore as rent! Shreyas Iyer signs 3-year deal for a luxury apartment in Worli
MUST READ: West Asia conflict puts record 5.4 lakh housing deliveries at risk in 2026: Report