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Informist, Tuesday, Jun. 30, 2026

MUMBAI – The growth in assets under management of affordable housing lenders is seen broadly steady on year at 19-20% in 2026-27 (Apr-Mar) and FY28, Crisil Ratings Ltd. said in a report Tuesday. Demand in tier-II and smaller markets, ongoing infrastructure buildout, and the government's focus on capital expenditure are key growth levers for the sector, the ratings agency said.

Rising urbanisation, favourable demographics, and low mortgage penetration are other important factors expected to benefit affordable housing financiers. Home loans, which comprise about 68% of these companies' assets under management, are likely to grow 17-18% in FY27 and FY28, while loans against property are seen rising around 23% during the same period, Crisil said.

The recent moderation in launches and sales of affordable residences is limited to metropolitan cities and is unlikely to affect the growth of these financiers, Subha Sri Narayanan, director of Crisil Ratings, said in the report. Affordable housing lenders' portfolios are geared mostly towards smaller markets and about 45% of their lending focusses on self-construction and resale of houses, Narayanan said.

The growth in loans against property, around 37% between FY23 and FY25 at a compounded annual rate, is expected to continue outpacing the growth in home loans, according to the report. The rise is, however, expected to be more measured this time around, Crisil said. Demand from micro, small and medium enterprises supported the increase in affordable housing lenders' loans against property.

However, "...heightened global uncertainties and uptick in inflation stemming from the conflict in West Asia, and their potential impact on borrower cash flows, could further temper risk appetite in the near term, leading to tighter credit filters and selective disbursements," Aesha Maru, associate director of Crisil Ratings, said in the release. Any rise in interest rates and macroeconomic developments will be key to watch going forward.  End

Reported by Ruchira Kagita

Edited by Avishek Dutta

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