Senior Housing Needs PMAY-like Grants and Tax Benefits as India's Ageing Population Surges

As India's population ages rapidly, the need for quality and affordable senior housing is more urgent than ever. According to a recent CREDAI-KPMG report, the senior population is set to more than double from 157 million in 2024 to an estimated 346 million by 2050—accounting for over 20.6% of the nation’s total population. This demographic shift highlights a critical gap in the housing market, underscoring the importance of developing targeted policies to support senior living.

The CREDAI-KPMG report advocates for initiatives similar to the Pradhan Mantri Awas Yojana (PMAY) to support developers who focus on senior housing. By providing PMAY-like grants, the government could significantly lower the cost burden on developers, enabling them to offer high-quality, affordable housing options for seniors. In addition to grants, the report recommends extending tax incentives, such as GST credits for construction materials, and property tax rebates for senior citizens. These measures would not only ease the financial strain on homeowners but also encourage developers to invest in the senior housing sector.

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At present, India’s organized senior living inventory stands at just over 21,000 units, with southern India accounting for about 62% of these projects. Key cities such as Coimbatore, Bengaluru, and Chennai contribute nearly 40% of the total senior living stock. Despite this, the demand far outweighs supply, particularly as more seniors seek housing that goes beyond traditional care homes. Modern seniors are looking for communities that offer not only safety and comfort but also opportunities for social engagement and a higher quality of life.

Globally, the senior living market was valued at approximately $190 billion in 2020 and is projected to reach around $375 billion by 2030. Regions like the Asia-Pacific and Middle East are witnessing rapid growth, with compound annual growth rates (CAGR) of 11.2% and 8.4% respectively. For India, tapping into this growing market could drive significant economic and social benefits. The CREDAI-KPMG report stresses that a strategic focus on senior housing can transform the sector into a major pillar of economic advancement and societal well-being.

Key Recommendations for the Future

To meet the escalating demand for senior housing, the report outlines several key recommendations:

• PMAY-like Grants: Developers focusing on affordable senior housing should receive grants similar to those under the PMAY scheme, reducing their financial risk and making projects more viable.
• Tax Incentives: Introducing tax credits on construction materials and offering property tax rebates for senior citizens will help lower operating costs and make homes more affordable.
• Rental Housing Schemes: Structured rental schemes, modeled on PMAY, could provide cost-effective solutions for seniors who prefer renting over owning.
• Uniform Policy Framework: Establishing consistent policies across states for tax rebates and other financial incentives will create a more predictable environment for both developers and buyers.

The CREDAI-KPMG report makes a compelling case for transforming the senior housing sector in India through targeted financial support and policy reforms. With the senior population expected to surge dramatically by 2050, PMAY-like grants and tax incentives can play a pivotal role in developing affordable, high-quality housing for seniors. By fostering a robust and inclusive senior housing market, India can ensure that its ageing citizens enjoy a dignified, comfortable, and sustainable living environment. The time to act is now, as strategic government intervention could not only boost the real estate sector but also pave the way for a more resilient and equitable society.

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