policycircle.org-Rising urban housing costs threaten India’s growth prospects
Rising urban housing costs: India is witnessing rapid urbanisation, with millions migrating to cities every year in search of opportunities. However, rising housing costs pose challenges to the economic stability and social equity of the changing demographics. Recent data from the Household Consumption Expenditure Survey show that the share of rent in consumption expenditure has risen to 6.58% — the highest in two decades. In urban areas, housing inflation, measured through the consumer price index, has been steadily climbing. This trend demands urgent policy interventions to mitigate its impact on economic growth and social welfare.
The escalating cost of housing has become a significant concern for policymakers. In urban areas, the share of rent in household expenditure has risen from 4.46% in 1999-2000 to 6.58% in 2023-24, reflecting a consistent upward trend over the past two decades. While rural rents remain comparatively lower, they have also increased marginally, rising from 0.39% in 1999-2000 to 0.56% in 2023-24. These figures highlight the growing burden of housing costs across the country, albeit with a sharper impact in urban centres.
