India’s residential real estate market delivered a paradox in 2025—home sales volumes fell sharply, but the total money spent on buying homes actually increased. Latest data from ANAROCK Research shows that while uncertainty weighed on buyer sentiment, rising prices and premiumisation ensured that the market’s overall value continued to climb.
Sales Drop 14%, Yet Housing Value Crosses ₹6 Lakh Crore
Across the top seven cities—Delhi-NCR, MMR, Bengaluru, Pune, Hyderabad, Chennai and Kolkata—housing sales declined 14% year-on-year in 2025. About 3.96 lakh homes were sold, compared to nearly 4.6 lakh units in 2024.
However, despite fewer transactions, the total sales value rose 6%, crossing ₹6 lakh crore, up from ₹5.68 lakh crore last year. This divergence highlights a clear shift: buyers are purchasing fewer homes, but at much higher prices.
According to market experts, this trend reflects sustained demand for larger, better-quality homes, even as affordability pressures restrict volumes.
Why Did Housing Sales Slow Down?
Several headwinds hit the residential market in 2025:
- Persistent price hardening across cities
- IT sector layoffs affecting buyer confidence
- Geopolitical tensions and tariff-related uncertainties
- Elevated borrowing costs for much of the year
“2025 has been a year of broad-spectrum upheaval,” says Anuj Puri, Chairman of ANAROCK Group. “Sales volumes stabilised around 4 lakh units, but growth continued in overall sales value, driven by a higher share of premium and luxury housing.”
MMR, Pune Lead Sales—But See Sharp Declines
The Mumbai Metropolitan Region (MMR) remained India’s largest housing market, with nearly 1.28 lakh homes sold in 2025, followed by Pune with about 65,000 units. Together, the two western markets accounted for almost half of all homes sold across the top cities.
Yet both markets saw steep declines:
- MMR: Sales fell 18%
- Pune: Sales dropped 20%
- Hyderabad: Saw the sharpest decline at 23%
Chennai stood out as the only city to buck the trend, recording a 15% increase in housing sales, supported by stable pricing and improving end-user demand.
New Launches Continue, But Supply Becomes More Selective
Despite slowing demand, developers remained active. The top seven cities saw 4.19 lakh new homes launched in 2025, a modest 2% increase over 2024.
MMR and Bengaluru dominated new supply, together accounting for 48% of total launches. However, supply patterns diverged sharply:
- Hyderabad and MMR cut back new launches by 26% and 6%, respectively
- Chennai, Kolkata and NCR saw strong supply growth
- Pune and Bengaluru maintained steady additions
The data indicates growing caution among developers, with new launches increasingly aligned to specific price segments and buyer profiles.
Luxury Housing Tightens Its Grip on the Market
One of the clearest structural shifts in 2025 was the rising dominance of luxury and premium housing.
- 21% of all new supply was priced above ₹2.5 crore, up from 18% in 2024
- In Delhi-NCR, over 55% of new launches were in the luxury and ultra-luxury category
- Premium homes increasingly drove overall market value growth
“More than 21% of the new supply was launched above the ₹2.5 crore price bracket,” notes Puri. “This trend is likely to persist into 2026.”
Prices Rise, But Pace Slows
While prices continued to rise, the pace moderated:
- Average housing prices rose 8% across the top cities
- This is a sharp slowdown compared to 13–27% growth seen in 2024
- Delhi-NCR recorded the highest rise at 23%, driven by luxury-heavy supply
- Other cities saw single-digit growth between 4% and 9%
The cooling price growth reflects both affordability constraints and a more balanced demand-supply equation.
Unsold Inventory Inches Up
Unsold housing inventory increased 4% year-on-year, reaching about 5.77 lakh units by the end of 2025. The rise was driven by generous new supply combined with slower absorption.
- Bengaluru saw a sharp 23% rise in unsold stock
- Hyderabad and MMR were the only markets to record marginal declines in unsold inventory, aided by controlled supply
What Lies Ahead for 2026?
The outlook for 2026 hinges on two critical factors:
- Interest rate cuts by the RBI
- Pricing discipline by developers
“With a favourable economic outlook and potential repo rate cuts, lower home loan rates could significantly revive housing demand,” says Puri.
While volume growth may remain selective, value-led growth, premiumisation, and end-user-driven demand are expected to define the next phase of India’s housing market.
Also Read: Pune housing prices rise in Q2 2022
