While housing sales across the top seven cities declined by 14% year-on-year to around 3.96 lakh units, the total transaction value rose by 6%, crossing ₹6 lakh crore—underscoring the growing dominance of higher-priced homes and premium housing segments.

Fewer Homes Sold, More Money Spent

The divergence between falling volumes and rising transaction value reflects a structural shift in India’s housing demand. After a prolonged period of muted price growth between 2015 and 2019, average residential prices surged by nearly 54% between 2019 and 2024, supported by post-pandemic recovery, infrastructure investment, and consolidation among stronger developers.

In 2025, price appreciation moderated to about 8%, a trend the report describes as healthier and more sustainable, driven largely by end-user demand rather than speculative buying.

Affordable Housing Shrinks, Luxury Expands

One of the most notable shifts highlighted in the report is the sharp decline in affordable housing’s share of overall sales. Homes priced below ₹75 lakh, which accounted for nearly 60% of total sales in 2021, now make up only about 32% of the market.

In contrast, luxury and ultra-luxury housing has expanded rapidly.

“Luxury homes priced above ₹4 crore now contribute nearly 18–20% of total sales across the top seven cities, compared to just 1–2% before the pandemic,” said Anuj Puri, Chairman, ANAROCK Group.

The ultra-luxury segment—homes priced at ₹40 crore and above—saw a sharp 66% jump in sales in 2025, with the Mumbai Metropolitan Region (MMR) accounting for more than 70% of such transactions.

Bigger Homes, Changing Preferences

Buyer preferences have also evolved significantly. The report notes a growing demand for larger homes, with 3BHK and larger units now accounting for nearly 45–50% of demand, up from about 30% in 2018.

Average unit sizes across major cities have expanded by roughly 40% since 2021, driven by post-pandemic lifestyle changes and work-from-home flexibility. The NCR market has seen the most pronounced shift, with average home sizes nearly doubling between 2022 and 2025.

Wellness-oriented layouts, lifestyle amenities, and low-density developments are increasingly influencing purchase decisions, particularly in Tier I cities, while Tier II cities are gradually gaining traction.

Supply Side Sees Institutionalisation

On the supply front, India’s residential market is becoming increasingly institutionalised. Listed and Grade-A developers now account for nearly 45% of total residential supply, up from 28% five years ago.

This consolidation reflects stronger balance sheets, improved governance, better execution capabilities, and rising buyer confidence in established brands.

Over the past five years, approximately 12,700 acres of land have been transacted across India, with nearly 60% earmarked for residential development, signalling long-term confidence in housing demand.

Macro Fundamentals Remain Supportive

The report highlights strong macroeconomic tailwinds supporting the sector’s long-term outlook. Private consumption continues to contribute nearly 60% of India’s GDP, while government capital expenditure has nearly tripled since FY19. The banking system remains stable, with net NPAs at multi-decade lows.

Importantly, India’s mortgage-to-GDP ratio stands at just ~11%, significantly lower than global peers—indicating substantial headroom for housing finance growth.

As India moves toward becoming a USD 7.3 trillion economy, the report concludes that residential real estate is no longer merely a cyclical sector but a structural pillar of economic growth, capital formation, and urban transformation.

Also Read: Will the Housing Market Create Another Peak in 2024?

The post India’s Housing Market Shifts Gears in 2025 as Value Growth Outpaces Sales Volumes appeared first on Square Feat India.

According to JLL Research, total housing sales across India’s top seven cities fell 11% year-on-year to 270,323 units in 2025, yet the market simultaneously witnessed a decisive shift toward premium housing. Apartments priced above ₹1 crore recorded a 6% year-on-year growth in unit sales, increasing their share of the market from 53% in 2024 to 63% in 2025.

This sharp divergence between volumes and value highlights a structural transformation underway in India’s housing market—one increasingly driven by premiumisation rather than mass demand.

Premium Homes Gain as Mass Housing Loses Ground

The most striking trend of 2025 was the contraction of the mass housing segment. Homes priced below ₹1 crore saw unit sales decline by 30%, with their market share shrinking from 47% in 2024 to just 37% in 2025.

In absolute terms:

• 99,265 sub-₹1 crore homes were sold in 2025
  • 25,413 units below ₹50 lakh
  • 73,852 units in the ₹50 lakh–₹1 crore range

In contrast, the ₹1.5–3 crore segment emerged as the fastest-growing category, recording a 19% year-on-year increase and accounting for 27% of total sales—up sharply from 20% a year earlier.

Higher ticket sizes also translated into stronger value growth. Despite the drop in unit sales, total residential sales value rose by around 11% year-on-year to approximately ₹5.57 lakh crore, underlining buyers’ willingness to pay premiums for quality, location, and branded developments.

City-wise Performance: Chennai Stands Out, Big Markets Moderate

Chennai: The Clear Outperformer

Chennai emerged as the standout residential market of 2025, registering 31% year-on-year growth to 14,837 units sold, defying the national slowdown. The city also recorded an exceptional 86% year-on-year jump in Q4 2025 sales, driven by rising preference for apartments over independent homes and strong uptake in premium projects.

Bengaluru: Volumes Dip, Value Holds

Bengaluru remained India’s largest residential market by volumes with 61,025 units sold, despite a 12% year-on-year decline. Importantly, the city led price appreciation, with capital values rising 13% annually in Q4 2025, reflecting sustained demand for premium housing despite moderation in sales.

Mumbai: Resilient Demand Amid Correction

Mumbai recorded 56,086 unit sales, down 15% year-on-year, yet continued to attract buyers in higher price brackets. Premiumisation remained evident, supported by limited land availability, redevelopment-driven supply, and steady end-user demand.

Delhi NCR: Sharp Volume Correction

Delhi NCR saw one of the steepest corrections, with sales falling 22% year-on-year to 38,981 units. However, the region also witnessed 13% annual price growth, indicating that premium developments continued to find takers even as overall volumes softened.

Pune: Relative Stability

Pune showed relative resilience, with sales declining marginally by 2% to 51,911 units. Strong employment fundamentals and steady mid-to-premium demand helped cushion the impact of broader market moderation.

Hyderabad and Kolkata: Diverging Paths

Hyderabad recorded 33,288 units, down 6% year-on-year, reflecting supply overhangs in certain micro-markets.
Kolkata, though smaller in scale, saw sales drop 21% to 14,195 units, even as premium launches gained traction.

Developers Double Down on Premium Supply

Supply-side trends reinforced the premiumisation narrative. While overall residential launches declined 3% year-on-year to 293,079 units, premium housing launches grew 6%, as developers prioritised higher-margin projects amid rising construction costs.

• Chennai led new launches, recording 45% year-on-year growth
• Kolkata, Pune and Chennai posted double-digit supply growth
• Mumbai and Hyderabad saw notable pullbacks in new launches

New launches accounted for 23% of annual sales, signalling sustained buyer confidence despite market adjustments.

Prices Rise Across Cities Despite Volume Decline

Home prices continued their upward trajectory across all major markets in 2025:

• Chennai, Bengaluru, Delhi NCR: 13% annual price growth
• Kolkata: 12%
• Other cities recorded 6–10% appreciation

Elevated construction costs, controlled inventory, and sustained demand for Grade A projects kept prices firm, reinforcing the shift toward value-driven transactions.

Outlook: Premiumisation Here to Stay

JLL expects India’s housing market to remain structurally strong despite short-term volume adjustments. Recent repo rate cuts, improved credit access, and stable employment conditions are likely to support demand, particularly in premium and upper mid-income segments.

Large, listed developers are expected to gain further market share through brand strength, execution capabilities, and strategic diversification across price segments—cementing premium housing as the central growth engine of India’s residential real estate market.

Also Read: Which City Sold the highest number of Homes in 2021?

The post Fewer Homes Sold, More Money Spent: ₹1 Crore+ Apartments Drive India’s Housing Market in 2025 appeared first on Square Feat India.

Affordable housing, once a backbone of India’s housing market, has seen its launch share shrink from 40% in 2019 to just 12% in H1 2025, while its sales share dropped from 38% to 18%.

What’s Driving Up Construction Costs?

The cost of building homes has risen sharply across India’s top cities. Here’s why:

• Raw Materials: Cement (+30% in 5 years), Steel (+57%), Copper (+91%), Aluminium (+80%).
• Labour: Wages up 150% since 2019 and 25% in the last year alone.
• Other Costs: Higher fuel, compliance, and approval expenses.

City-Wise Construction Costs (2025 Estimates)

Impact on Affordable Housing Buyers

For affordable homebuyers, even a ₹500–800/sq. ft increase means ₹5–8 lakh more on a 1,000 sq. ft flat — a deal-breaker for many families. Developers, facing thin margins, have slowed down launches, leading to an affordable housing crisis.

By contrast, mid-range and luxury projects can absorb cost hikes more easily. Luxury housing buyers are less price-sensitive, while affordable buyers often drop out entirely.

Tariffs & GST: Will They Help or Hurt?

• Tariffs: A proposed 25–50% tariff on steel, aluminium, and imported materials could push costs 2–5% higher, worsening affordability.
• GST Reforms: The government’s move to cut GST on cement from 28% to 18% could reduce home prices by 2–4% in affordable housing and 2–3% in mid-range housing — modest but meaningful relief.

Segment-Specific Trends

• Affordable Housing: From 40% share in 2019 to just 12% in H1 2025 (supply), sales also down to 18%.
• Mid-Range: Buyers stretched but still present; prices rising 9–12% annually.
• Luxury: Least affected — buyers accept higher costs for exclusivity.

What This Means for Homebuyers

For India’s middle- and lower-income households, the report signals a grim reality: affordable housing is fast disappearing. With costs rising and supply shrinking, buying early may be the only way to lock in a home before prices climb further.

The post Affordable Homes Slip Away: Construction Costs Up 40%, Affordable Housing Share Falls to 12% appeared first on Square Feat India.

From Noida’s meteoric rise to Bengaluru’s IT-driven corridors, and from Hyderabad’s corporate clusters to Mumbai’s metro-linked suburbs, the winners share common DNA – infrastructure upgrades, job hubs, and planned urban growth.

Post-Pandemic Surge

The recovery that began in 2021 was driven by pent-up demand, low home loan rates, and a shift towards homeownership.

• In 2021–2023, prime job markets saw annual rental jumps of 12–24%.
• By mid-2025, rental growth had cooled to 7–9% annually — still above inflation.
• Capital values followed the same arc: steep early gains, then steady appreciation as new supply entered the market.

Top 14 Micro Markets – Capital Value Growth (2021–Q2 2025)

Top 14 Micro Markets – Rental Growth for 2BHK (2021–Q2 2025)

City-Wise Spotlight

Bengaluru – The Metro and IT Power Combo

• Sarjapur Road: 79% price growth, 81% rent rise, driven by the upcoming Red Line Metro and IT corridor buzz.
• Thanisandra: 81% capital gains, 65% rental hike, fuelled by proximity to Manyata Tech Park.

Hyderabad – Corporate Corridor Supremacy

• HITECH City: 70% price rise, 58% rent growth.
• Gachibowli: 87% capital gains, 66% rent increase, powered by MNC campuses and high-end housing.

Pune – IT Hub Meets Affordable Fringe

• Hinjewadi: 40% price, 60% rental jump due to steady IT workforce inflow.
• Wagholi: Similar price growth but 69% rent spike, attracting yield-focused investors.

NCR – The Big Winner

• Sohna Road: 74% capital gains, 50% rent growth from expressway linkages.
• Sector-150 Noida: National leader – 139% capital appreciation, 71% rent rise, thanks to greenfield planning and mega-townships.

MMR – Connectivity Transforms Suburbs

• Chembur: 53% price rise, 46% rental increase due to Metro extensions and Eastern Freeway.
• Mulund: 50% price growth, slower rent rise (32%) due to high base levels.

Kolkata – Steady but Rewarding

• EM Bypass: 25% price growth, 53% rent rise, boosted by central connectivity.
• Rajarhat: 37% capital appreciation, 40% rent growth from planned township appeal.

Chennai – Transit-Linked Growth

• Perambur: 26% price, 39% rent increase from metro and suburban rail.
• Pallavaram: 24% price growth, 46% rent jump, near airport and OMR IT corridor.

What Drove These Gains

• Infrastructure Investment: Metro, expressways, airport projects.
• Employment Clusters: IT hubs, corporate parks.
• Planned Urban Growth: Large-scale master plans and greenfield projects.
• Relative Affordability: Peripheries offering better entry points and steady demand.

The 2026 Outlook

According to Anuj Puri, Chairman, ANAROCK Group:

“In 2026, housing prices are expected to grow 6–7% and rentals 7–10%, outpacing inflation. Micro markets linked to major infrastructure completions will continue to outperform.”

For investors, the next big opportunities lie in tracking metro lines, expressways, and new employment corridors before they become fully priced in.

Also Read: Mumbai’s real estate market a hotspot for foreign investors

The post Where Property Prices Doubled in 3 Years – India’s Real Estate Hotspots Revealed appeared first on Square Feat India.