India Home Mortgage Finance Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | > 7.00 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
India Home Mortgage Finance Market Analysis
India Home Mortgage Finance Market is poised to grow at a CAGR of 7% during the forecast period.
With favorable conditions like rising income levels, improved affordability, and fiscal support, the demand for homes is expected to grow in this market. Real estate in India is on an upcycle. Developers are now financially stronger and more disciplined.
Due to the outbreak of the COVID-19 pandemic, the home mortgage finance market in India was heavily impacted. Due to the lockdown in India, there were limited job prospects and a drop in income; some people even lost their jobs during the pandemic, which resulted in a fall in the housing market and housing loan demand. The pandemic resulted in the central banks using three key tools to make the most out of the housing situation: Open market operations, interest rates, and reserve requirements. RBI (the Reserve Bank of India) also slashed repo rates, reaching a two-decade low at 4.4%. With all these policies, the government attempted to make home loans more affordable during a crisis where job security for most sectors was not guaranteed.
In India, housing finance is offered by banks and housing finance companies (HFCs). With the introduction of several economic reforms and a rise in demand for housing infrastructure across cities, globally renowned industrial houses are now venturing into the housing market. At present, public and private sector banks and foreign banks are extending loans to prospective buyers. However, the home mortgage finance market is dominated by HFCs.
India Home Mortgage Finance Market Trends
This section covers the major market trends shaping the India Home Mortgage Finance Market according to our research experts:
Availability of Affordable Housing in India is Driving the Market Growth
The housing market has undergone a structural transformation in both the demand and supply sides over the last decade. This has resulted in a safe and attractive home-buying environment for buyers. Housing loans contribute around 50% of personal/retail loans. Housing affordability has improved over the last eight years. It reached its best levels last fiscal year and remains fairly attractive. This is expected to boost end user demand in key segments of affordable and mid-income. In FY 2000, property prices, on average, were 5.9 times the annual income of a buyer. In FY2020, the price of the property that a person purchased was, on average, 3.3 times the annual income. With affordability rising, one can buy a bigger property with their current income. Home loan rates are down by about 1.2-1.3% compared to last year alone. This is expected to drive the growth of the home mortgage finance market in India during the forecast period.
Increase in Work From Home Settings Can Surge the Demand for Housing in Tier-III and Tier-IV Cities
The trend of working from home during the COVID-19 lockdown has led to an increase in home loan demand in tier-III and tier-IV towns and districts. Many companies have shifted to a work-from-home setting, and many outstation employees have returned to their native places to cut living costs in the overcrowded metro and tier-I cities. Now with many companies, especially in the tech and IT industry continuing with a hybrid or a work-from-home setting, the demand for upscale residential projects in tier-III and tier-IV cities has seen a boost. The share of housing loans contributes to 50% of retail or personal loans by scheduled commercial banks (SCBs), which has increased to 14.14% in June 2022, up from 13.1% in March 2020 during the pandemic. Work from home has emerged as the dominant factor behind the increased demand for home loans across tier-III and tier-IV towns and districts. This is expected to grow the market during the forecast period.
India Home Mortgage Finance Industry Overview
India's home mortgage finance market is fragmented market. It has the presence of over 40 considerable regional and local players in the market. Although banks dominate the India home mortgage finance sales in 2021, a significant growth can be observed for non-bank lenders in the near future. Companies including, HDFC Housing Finance, LIC Housing Finance Limited, Indiabulls Housing Finance Limited, L&T Housing Finance Limited, and PNB Housing Finance Limited, among others have been profiled in the report.
India Home Mortgage Finance Market Leaders
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HDFC Housing Finance
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LIC Housing Finance Limited
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Indiabulls Housing Finance Limited
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L&T Housing Finance Limited
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PNB Housing Finance Limited
*Disclaimer: Major Players sorted in no particular order
India Home Mortgage Finance Market News
- November 2022: Tata Capital Housing Finance, a Tata Capital subsidiary, intends to push into the home loan market significantly. To do so, it is looking for the capital of INR 3,000 crore from the National Housing Bank and intends to raise INR 1,000 crore through bonds. Both retail and real estate developers are expected to be eligible for financing from the organization.
- October 2022: Private sector lender HDFC Bank will complete its planned merger with Housing Development Finance Corp. Ltd by the first quarter of FY24 instead of the original target of the third quarter.
India Home Mortgage Finance Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Deliverables
1.2 Study Assumptions
1.3 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.3 Market Restraints
4.4 Porter's Five Forces Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
4.5 Impact of Government Initiatives and Regulations on the Market
4.6 Impact of Technological Innovations in the Market
4.7 Impact of COVID-19 on the Market
5. MARKET SEGMENTATION
5.1 By Source
5.1.1 Bank
5.1.2 Housing Finance Companies (HFC's)
5.2 By Interest Rate
5.2.1 Fixed Rate
5.2.2 Floating Rate
5.3 By Tenure
5.3.1 Upto 5 Years
5.3.2 6 - 10 Years
5.3.3 11 - 24 Years
5.3.4 25 - 30 Years
6. COMPETITIVE LANDSCAPE
6.1 Market Concentration Overview
6.2 Company Profiles
6.2.1 HDFC Housing Finance
6.2.2 LIC Housing Finance Limited
6.2.3 Indiabulls Housing Finance Limited
6.2.4 L&T Housing Finance Limited
6.2.5 PNB Housing Finance Limited
6.2.6 IIFL Housing Finance Limited
6.2.7 GIC Housing Finance Limited
6.2.8 Sundaram Home Finance
6.2.9 Tata Capital Housing Finance Limited
6.2.10 Can Fin Homes Limited
6.2.11 Repco Home Finance
6.2.12 Akme Star Housing Finance Limited
6.2.13 Sahara Housing Finance
6.2.14 India Home Loan Limited*
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
8. DISCLAIMER AND ABOUT US
India Home Mortgage Finance Industry Segmentation
Home mortgage finance is the process of offering something as a guarantee or collateral against a loan to purchase a house. They are used to buy a home or borrow money against the value of a home you already own. It is offered by a bank, mortgage company, or financial institution to purchase a primary residence, a secondary residence, or an investment residence.
The India home mortgage finance market is segmented by source (Housing Finance Companies (HFCs) and Banks), by interest rate (fixed rate and floating rate), and by tenure (Upto 5 years, 6 - 10 years, 11 - 24 years, and 25 - 30 years). The report offers market size and forecasts for India Home Mortgage Finance Market in value (USD Million) for all the above segments.
| By Source | |
| Bank | |
| Housing Finance Companies (HFC's) |
| By Interest Rate | |
| Fixed Rate | |
| Floating Rate |
| By Tenure | |
| Upto 5 Years | |
| 6 - 10 Years | |
| 11 - 24 Years | |
| 25 - 30 Years |
India Home Mortgage Finance Market Research FAQs
What is the current India Home Mortgage Finance Market size?
The India Home Mortgage Finance Market is projected to register a CAGR of greater than 7% during the forecast period (2024-2029)
Who are the key players in India Home Mortgage Finance Market?
HDFC Housing Finance, LIC Housing Finance Limited, Indiabulls Housing Finance Limited, L&T Housing Finance Limited and PNB Housing Finance Limited are the major companies operating in the India Home Mortgage Finance Market.
What years does this India Home Mortgage Finance Market cover?
The report covers the India Home Mortgage Finance Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the India Home Mortgage Finance Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
How is India Home Mortgage Finance Market Segmented?
India Home Mortgage Finance Market Segmented by a) Types of Home Loans: Home purchase loans, Home construction loans, Home improvement loans, and Home loan balance transfer b) Lenders: Banks (public and private), Non-banking financial companies (NBFCs) and Housing finance companies (HFCs)
What are the Challenges faced by the India Home Mortgage Finance Market?
The Challenges faced by the India Home Mortgage Finance Market are a) Regulatory complexities and frequent policy changes b) High non-performing assets (NPAs) due to loan defaults c) Limited access to finance for some segments due to lack of documentation or credit history d) Economic fluctuations impacting interest rates and housing demand
India Home Mortgage Finance Industry Report
India Home Mortgage Finance Market, documented by Mordor Intelligence™ Industry Reports, has seen notable growth, spurred by an increase in housing demand and supportive government measures. This growth is shaping a competitive landscape in the home loan market in India, where banks, NBFCs, and HFCs compete for a significant share. These entities offer a variety of mortgage products tailored to different consumer segments like salaried individuals, self-employed professionals, and NRIs. India housing finance market size expansion is further fueled by favorable demographics such as urbanization and rising disposable incomes, coupled with low-interest rates and technological advances that streamline the lending process. Initiatives aimed at affordable housing are expanding opportunities in both major cities and tier II and III areas, improving accessibility and affordability across various property types. With ongoing digital transformation and a focus on customer-centric solutions, the sector is poised for robust expansion. For a detailed analysis, including market share, size, and revenue growth rates, consult the free report PDF download from the Mordor Intelligence™ Industry Reports.
India Home Mortgage Finance Report Snapshots
