Home loans grow 10% amidst luxury housing boom

Bengaluru: Driven by rising residential demand, India’s home loan market continues to strengthen. The number of home loans in top cities grew by 10% year-on-year (YoY) in the last financial year (FY25), according to a report by Urban Money, fintech venture of Square Yards, out on Tuesday.

Over the fiscal year, the total value of home loans disbursed in these cities rose by 15%, reflecting a shift towards premium homes as well as notable increase in property prices - up by 55-60% on average since FY19.

Property-linked loans, comprising home loans and loans against property, accounted for the largest share (63%) of total loan disbursals in FY25.

Notably, loans with ticket sizes above Rs 1 crore accounted for 21% of total home loan disbursals during the year. In comparison, home loans below Rs 45 lakh accounted for 47% of disbursals, while those between Rs 45 lakh and Rs 1 crore made up 32%.

The home loan growth comes amidst India’s premium and luxury housing boom.

The average home loan value in the top cities reached Rs 74 lakh in FY25, marking a 5% year-on-year increase. Mumbai and Gurugram recorded the highest average home loan values, at Rs 99 lakh and Rs 88 lakh respectively in FY25.

Adding a gendered analysis, the report observed that the increase in home loans included a 10% increase among male borrowers and a 9% increase among female borrowers. Year-on-year growth in disbursal value stood at 14% for men and a higher 23% for women. One in five home loans disbursed during FY25 was to a woman borrower.

The total number of registered residential transactions in key cities, as recorded by the Inspector General of Registration (IGR), increased from 3.07 lakh units in FY19 to 5.44 lakh units in FY25, marking a 77% growth over the six-year period.

The report covers cities including Bengaluru, Gurugram, Noida and Greater Noida, Hyderabad, Mumbai, Thane, Navi Mumbai, and Pune.