While calculating the consumer price index, 'housing' as an item is classified as :

In the Consumer Price Index (CPI), 'housing' is classified as a core service. While CPI measures price changes for a fixed basket of goods and services [2], housing is specifically treated as a service because it represents the flow of shelter services consumed by households. In India, the CPI basket is divided into goods and services, with housing being a major component of the services sector alongside healthcare and education. The index accounts for housing through actual rents paid or, in the case of owner-occupied housing, through 'imputed' or 'owners' equivalent' rent, which models the cost of the shelter service provided by the property [1]. Unlike consumer durables, which are physical goods that last over time [1], housing in the context of inflation measurement focuses on the ongoing service of accommodation rather than the capital asset itself.

Sources

1. [2] https://labourbureau.gov.in/cpi-iw-faq
2. [1] Macroeconomics (NCERT class XII 2025 ed.) > Chapter 6: Open Economy Macroeconomics > National Income Identity for an Open Economy > p. 101