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Haryana's flagship affordable housing policy has effectively stalled in Gurugram and Faridabad, with developers and industry stakeholders saying that escalating land and construction expenses have made projects under the scheme financially unviable. Officials from the Town and Country Planning Department have confirmed that no new licences for affordable housing projects have been granted in Gurugram over the past one-and-a-half to two years, and the Gurugram-Manesar Master Plan area has not seen any fresh affordable housing developments during this period. Under the current policy, the sale price of affordable units is capped at INR 5,000 per sq ft, but surging input costs have far outpaced this rate, leaving developers unable to meet prescribed price limits. Homebuyers and industry bodies are now urging the state government to revise the pricing framework and make the policy continuous rather than episodic to restore project momentum.
The implementation of Haryana's affordable housing policy has encountered significant headwinds in Gurugram and Faridabad, with stakeholders reporting near-complete inactivity on the ground due to rapidly rising land acquisition and construction costs. According to officials from the Town and Country Planning (TCP) Department, no new licences for affordable housing projects have been issued in Gurugram in the past one-and-a-half to two years, and the Gurugram-Manesar Master Plan area has not seen a single new affordable housing development during this period. Advertisement
Under the existing policy framework, the government capped the maximum sale price of affordable housing units at INR 5,000 per sq ft in both Gurugram and Faridabad. Typical unit sizes are set between 500 sq ft and 800 sq ft, positioning homes in a price range between approximately INR 26 lakh and INR 35 lakh. However, industry experts have noted that land prices in several key sectors of Gurugram have more than doubled over the past five years, while construction costs have risen by an estimated 25-30%, making it increasingly difficult for developers to adhere to the sale price cap and still maintain project viability.
Developers have reportedly scaled back or postponed new affordable housing proposals, citing unfavourable economics. With limited prospects for profitability under the current pricing regime, industry participants say that affordable housing projects are financially untenable, leaving prospective homebuyers without fresh supply and frustrating market expectations.
Residents have also voiced concern over the slowdown in new projects. Middle-class buyers in the NCR towns had been anticipating new affordable housing options, but efforts to purchase homes at prices aligned with policy intentions have been largely unsuccessful over the recent period. In response, developers and industry bodies have stepped up calls for a comprehensive revision of the pricing structure, advocating for an increase of at least 20-25% in the prescribed sale rates to reflect current market realities. They have also urged the government to make the policy open and continuous rather than episodic, to encourage sustained participation and reinvigorate affordable housing supply.
The policy's current impasse highlights the challenge of aligning regulatory pricing limits with the substantial cost escalations seen in land and construction inputs a dynamic that has stalled project approvals and deterred developers from committing to new affordable housing schemes across key NCR suburbs.
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