NEW DELHI: According to a report from Anarock Capital, India’s real estate sector will need nearly ₹50 lakh crore in capital over the next decade to sustain its growth.
The report points to a shift in the sector’s financing landscape, evolving from a fragmented, NBFC-led model to a more organized, institutional framework supported by banks, alternative investment funds, real estate investment trusts, private credit, and government initiatives.
However, it highlights that capital is primarily concentrated among established developers and in major metropolitan areas, which results in disparities in affordable housing, smaller developers, and tier II and III cities.
Despite a high demand for affordable housing, funding remains limited. Currently, India faces an urban housing deficit of roughly 10 million units and will need a minimum of 25 million affordable homes by 2030.
Homes priced below ₹40 lakh comprised only 10% of new launches in Q1 2026, down from 26% in 2021, while homes costing over ₹1.5 crore made up 53% of new launches.
The report notes that over 4.5 lakh affordable and mid-income homes are stalled across more than 1,500 projects, requiring about ₹55,000 crore in funding in 2024.
The SWAMIH Fund, initiated in 2019 and later expanded to ₹15,530 crore, has facilitated the completion of 58,596 homes, with total expectations of over one lakh units. An additional ₹15,000 crore blended-finance vehicle, SWAMIH Fund 2.0, was introduced in Budget 2025-26 to complete another one lakh stalled units.
On the retail finance side, PMAY-Urban 2.0 aims to support an additional one crore urban homes. Affordable housing finance companies are projected to increase assets under management by 20-21% in FY26-27, outpacing the broader mortgage market.
Outstanding individual housing loans reached ₹38 lakh crore by February 2026 and are expected to hit ₹77 lakh crore by FY30, growing at a compound annual growth rate of 15%.
In commercial real estate financing, banks represent about 56% of overall lending with exposure around ₹5.2 lakh crore. Non-banking financial companies and housing finance companies account for approximately 22% of the market. Notably, 80% of commercial real estate lending is concentrated in the MMR, NCR, and Bengaluru regions.
The potential for REITs in India is also notable. The six listed REITs possess a combined market capitalization exceeding ₹2 lakh crore, yet they constitute only 0.4% of India’s stock market capitalization.
Currently, only 198 million sq ft—or about 37%—of India’s estimated 520 million sq ft REIT-eligible office space is listed, with REITs representing around 20% of the listed real estate market value, below levels seen in developed markets.
The report identifies data centers, logistics, industrial real estate, and GCC-led office developments as primary targets for long-term capital in the coming years. It forecasts that India’s data center capacity will surpass 8 GW by 2030, while warehousing space has expanded to over 605 million sq ft.
Demand from GCCs and tech firms could drive the need for 1.2 billion sq ft of office space by 2030, according to the report.
