Residential Construction to Touch $350 Billion by 2030, Says Deloitte

India’s housing and building materials industry is standing at a defining moment, propelled by the twin forces of technology and sustainability.

A new Deloitte India report, Building Beyond Basics: Innovations Transforming India’s Living Spaces, reveals how the country’s residential construction sector, already growing at 6.8 percent in FY2024–25, is poised to reach an astonishing US$350 billion by 2030.

This growth story is not just about more homes being built, but about an evolution in consumer expectations, material preferences, and the very idea of what a home represents in a fast-urbanising India.

Shifting Consumer Behaviour: Quality Over Price

One of the standout findings of the Deloitte report is the remarkable shift in consumer priorities. Nearly half of all home-related purchases today are motivated by lifestyle upgrades or product obsolescence rather than necessity. While affordability remains important, price ranks lower at 25 percent compared with quality, sustainability, and overall purchase experience.

The study highlights that 86 percent of Indian consumers prefer branded outlets or experience centres when making high-involvement purchases. More significantly, a growing number of buyers are willing to pay extra for eco-friendly, customised, and branded materials. This reflects the rising aspirations of a middle class that is becoming increasingly conscious of both comfort and sustainability.

Market Trajectory: US$166 Billion in Building Materials

The building materials market alone is set for an impressive expansion, increasing from US$105 billion in FY2025 to US$166 billion in FY2030, marking a 9.6 percent CAGR. This acceleration is fuelled by demand for high-performance, low-maintenance products such as engineered wood panels, vinyl flooring, and decorative paints.

Praveen Govindu, Partner at Deloitte India, said, “India’s construction and building materials industry is at an inflection point, one where aspirations, technology and sustainability converge to reshape the way we live. The sector is no longer about homes alone, but about experiences, lifestyles and future-ready communities. The brands that can anticipate these shifts, innovate with purpose and embed sustainability at scale will not just ride this growth wave, they will set the benchmarks for India’s journey to a US$350 billion market.”

Premiumisation Wave In Indian Homes
With rising disposable incomes and aspirations, Indian households are undergoing a “premiumisation” trend. Consumers now prefer higher-quality and longer-lasting materials, from premium wood and flooring solutions to decorative paints designed for durability and aesthetics. This trend extends beyond mere product categories, embedding itself in the idea of the home as a lifestyle statement.

Smart technologies are integral to this transformation. The Indian smart home market is projected to grow at an impressive 30 percent CAGR between 2025 and 2030. AI-enabled electrical devices, sensor-integrated lighting, and energy-efficient roofing solutions are quickly shifting from luxury to necessity.

Electricals And Security Markets On The Rise

The domestic electricals sector is another area where consumer preferences are redefining the landscape. Branded players are steadily gaining dominance, with their market share projected to rise from 76 percent in 2023 to 82 percent by 2027.

This transition indicates a growing trust in organised, branded solutions that guarantee safety, durability, and advanced technology.

The home security market, encompassing smart locks, surveillance cameras, and hazard prevention devices, is growing at 18 percent CAGR and is expected to reach US$4.4 billion by FY2030. These innovations not only reflect consumer concerns about safety but also align with the broader shift towards smarter, connected living spaces.

Flooring, Paints, And Furniture As Growth Drivers

The flooring segment, traditionally a fragmented market, is expected to grow at an annual rate of 8.6 percent, reaching US$16.2 billion by FY2030. Alongside paints and furniture, these categories are becoming pivotal to India’s home and household consumption, often serving as the most visible markers of lifestyle upgrades.

Decorative paints, engineered furniture, and luxury flooring materials are in strong demand among aspirational homeowners who seek to align aesthetics with functionality.

Government Programmes As Accelerators

While consumer behaviour is shaping demand, government policy is creating an enabling ecosystem. Programmes such as the Pradhan Mantri Awas Yojana (PMAY) have already delivered more than 28 million homes, with funding allocations amounting to US$130.57 billion between 2021 and 2024. Such initiatives not only address the quantitative shortage of homes but also stimulate demand for higher-quality materials across segments.

Complementing PMAY, schemes like UJALA (Unnat Jyoti by Affordable LEDs for All) and UIDF (Urban Infrastructure Development Fund) are aimed at improving infrastructure and housing, especially in Tier-2 and Tier-3 cities. As smaller cities expand, the demand for branded, sustainable, and technologically advanced building materials is set to surge.

The Sustainability Imperative

Sustainability is emerging as a non-negotiable factor in the choices of Indian households. From eco-friendly paints to energy-efficient appliances and green-certified materials, consumers are actively choosing products that lower their environmental impact. Developers and brands that align themselves with these preferences are likely to win long-term loyalty and market share.

The emphasis on green living is also being reinforced by regulatory frameworks and global climate commitments. The increasing awareness of environmental concerns has made eco-friendly housing solutions a mainstream expectation rather than a niche choice.

Towards A US$5 Trillion Economy

India’s residential construction and building materials industry is more than just a growth story; it is a critical component of the nation’s economic ambitions. As the country marches towards its US$5 trillion economy goal, the home and household sector will remain central to urban development and lifestyle transformation.

With the sector’s contribution projected to reach US$350 billion by 2030, the implications go beyond real estate. Job creation, supply chain development, and the integration of technology and sustainability are likely to ripple across industries, reinforcing India’s position as the fastest-growing major economy in the world.

Looking ahead, the success of companies in this sector will depend on their ability to integrate consumer empathy with innovation. The report underscores that the winners of tomorrow will not only deliver homes but create experiences—spaces that combine comfort, safety, sustainability, and smart technologies.

The journey of India’s housing industry is thus no longer about shelter. It is about shaping how people live, how communities evolve, and how aspirations are fulfilled in a rapidly modernising economy.