The report highlights that while overall volumes have plateaued after a strong multi-year upcycle, the market remains structurally healthy, supported by end-user demand, manageable inventory levels, and sustained price growth across key cities.

Second Half of 2025 Records Strongest Sales Since 2013

A key takeaway from the report is the performance of the second half of the year. H2 2025 residential sales touched 178,406 units, making it the strongest second-half performance since 2013.

Sales during H2 2025 were marginally higher by 0.4% year-on-year, indicating that buyer sentiment remained resilient despite affordability pressures and higher ticket sizes.

Market health indicators also remained stable, with the quarters-to-sell (QTS) ratio holding firm at 5.8 quarters, signalling efficient inventory absorption even as unsold stock edged up marginally.

Mumbai Leads Sales; NCR Sees Sharp Price Growth

Mumbai continued to dominate India’s residential market, accounting for 29% of total sales in 2025.

• Mumbai: 97,188 units sold in 2025, up 1% YoY
• Bengaluru: 55,373 units, broadly stable YoY
• NCR: 52,452 units, down 9% YoY
• Pune: 50,921 units, down 3% YoY

While NCR saw a decline in volumes, it emerged as the strongest price growth market, recording a 19% year-on-year increase in weighted average prices, the highest among all major cities. Hyderabad, Bengaluru, and Mumbai followed with price growth of 13%, 12%, and 7%, respectively.

Knight Frank attributes the price rise largely to a higher share of premium and mid-premium launches, rising land and construction costs, and sustained demand in well-located projects.

Homes Above ₹1 Crore Now Account for Half of All Sales

One of the most significant structural shifts highlighted in the report is the growing dominance of higher-ticket housing.

• Homes priced above ₹1 crore accounted for nearly 50% of all residential sales in 2025
• Sales in this segment rose 14% year-on-year to over 175,000 units
• In contrast, homes priced below ₹50 lakh saw a 17% YoY decline, dropping to just 21% of total sales

This marks a sharp shift from 2022, when sub-₹50 lakh homes accounted for nearly 63% of total sales, underscoring a decisive tilt toward premium housing.

The mid-range segment (₹50 lakh to ₹1 crore) also witnessed moderation, with volumes declining 8% YoY, pointing to increasing demand polarisation.

Affordable Housing Under Pressure

While overall affordability has improved in several cities due to income growth and stable interest rates, the report notes that lower-income segments continue to face structural challenges.

Limited availability of viable affordable housing stock, rising land prices, higher construction costs, and constraints in access to formal credit have collectively weighed on demand in the sub-₹50 lakh category. Supply trends in this segment have mirrored demand, reducing the risk of speculative inventory build-up.

Inventory Levels Rise, But Market Remains Balanced

Residential launches across the top eight cities totalled 362,184 units in 2025, declining 3% YoY but still exceeding sales, leading to a gradual increase in unsold inventory.

However, Knight Frank notes that inventory levels remain manageable and well-distributed, with QTS remaining below six quarters nationally. Cities such as Pune, Chennai, and Kolkata continue to show relatively faster inventory churn, while NCR and Ahmedabad exhibit longer selling cycles.

Expert Commentary: Market Enters a Consolidation Phase

Commenting on the findings, Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India, said:

“India’s residential market in 2025 has clearly entered a phase of consolidation at elevated levels. With approximately 3.48 lakh homes sold during the year, demand has held steady after an exceptional multi-year run. This reflects genuine end-user depth rather than episodic spikes. Manageable inventory levels and low quarters-to-sell reinforce that the residential sector remains active, disciplined and structurally balanced as it moves into 2026.”

Echoing this view, Gulam Zia, International Partner and Senior Executive Director, Knight Frank India, added:

“Homes priced above ₹1 crore now constitute half of total sales, highlighting the decisive tilt toward higher-value products. While affordable segments remain subdued, larger markets continue to absorb supply steadily despite price appreciation, pointing to a structurally sound market.”

Outlook for 2026: Stability Over Volume Expansion

Looking ahead, Knight Frank expects 2026 to be characterised by stable absorption, selective price appreciation, and disciplined supply additions. While rapid volume growth may remain limited after two years of peak sales, the premium and mid-premium segments are likely to continue anchoring market activity.

The residential sector, the report concludes, is transitioning from expansion to maturity-led growth, with city-specific dynamics increasingly shaping outcomes.

Also Read: Residential sales surge to a 15-Year high 

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This trend highlights how premium housing demand remains strong, driven by affluent homebuyers prioritizing lifestyle, location, and long-term asset value — even amid rising property prices and cautious sentiment in the broader market.

Premium Homes Power the Market

• Apartments priced at ₹1 crore and above contributed 62% of total home sales between January and September 2025 — up sharply from 52% in the same period last year.
• The biggest surge came from the ₹1.5 crore–₹3 crore bracket, which saw a 10% rise in sales, showing strong appetite for mid-premium and luxury homes.
• In contrast, homes priced below ₹1 crore saw a 30% Y-o-Y decline, indicating waning traction in the mass housing segment.

Key takeaway: The Indian housing market is clearly moving toward value-driven and quality-led demand, as end-users and investors alike prioritize long-term appreciation and better living standards over entry-level affordability.

Top Cities Continue to Lead, Despite a Slowdown

Bengaluru, Mumbai, and Pune remained the top-performing cities, together accounting for more than 60% of total sales across India’s seven major metros.

• Pune and Chennai were standout performers with 14% and 13% annual sales growth, respectively.
• Delhi NCR and Mumbai saw sharper corrections due to higher pricing and supply adjustments.
• Despite a 9% decline in Q3 2025 sales, the premium category held steady, particularly in the ₹1.5–3 crore segment, which grew 14% Y-o-Y during the quarter.

According to Dr. Samantak Das, Chief Economist and Head of Research, JLL India:

“The January–September 2025 period has seen the market recalibrate toward value. Even with lower volumes, demand for premium housing remains steady, and nearly a quarter of total sales came from projects launched within the same year — indicating continued buyer confidence in new supply.”

Developers Shift Focus to High-Value Projects

Developers are realigning their portfolios toward premium housing, reflecting both demand resilience and higher margins.

• New home launches across top cities stood at 2.25 lakh units in the first nine months of 2025, marginally down 1% Y-o-Y.
• However, launches in the ₹1 crore+ category grew by 5%, underscoring the pivot to high-value products.
• Chennai, Kolkata, Pune, and Bengaluru witnessed the strongest growth in new project launches.

As Siva Krishnan, Senior Managing Director (Chennai & Coimbatore), JLL India, noted:

“Developers have been cautious in mid-income and affordable launches, where demand has softened. The focus on premium projects has helped stabilize inventory levels and sustain healthy absorption rates.”

Prices Keep Rising — Even as Volumes Dip

While overall sales volumes dipped, home prices continued their upward trajectory across all major cities:

• Kolkata led with a 16% Y-o-Y increase, followed by Chennai (14%), and Delhi NCR and Bengaluru (13%).
• The combination of higher input costs, premium product launches, and sustained demand helped developers maintain pricing power.

In short, price resilience amid slower sales reflects a maturing market that is consolidating toward financially stronger developers and serious end-users.

What It Means for Homebuyers and Developers

For homebuyers:

• Premium projects are becoming the new normal in major metros.
• Rising prices suggest urgency — waiting may cost more in 2026.
• Projects by branded developers are increasingly seen as safe, value-stable investments.

For developers:

• The premium segment offers better margins and faster absorption.
• Slower mid-range sales could push smaller players to consolidate or collaborate with larger firms.
• Market maturity will encourage sustainable, experience-driven housing instead of speculative supply.

Outlook: A Premium-Led Future

The Indian housing market is transitioning from rapid expansion to measured, value-oriented growth. Rising construction costs, land prices, and consumer preferences are collectively pushing the market toward the upper end.

Luxury and premium housing will continue to drive overall market momentum through 2026, even as total volumes stabilize. For serious developers, this presents a window to build credibility, deliver quality, and capture the aspirational buyer base shaping India’s next real estate cycle.

Also Read: Mumbai Property Registrations Rise Despite Shraadh Period

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Despite changing lifestyles, growing urbanisation, and a rising gig economy, the Indian obsession with owning property remains as strong as ever. In fact, it’s evolving, with younger generations now buying homes not just to live in — but to earn from, pass on, and hold close as a symbol of identity.

This enduring love for real estate, experts say, is deeply tied to India’s socio-cultural values, family structures, and long-term financial behavior.

“Owning a home in India is not just a financial decision — it’s a deeply emotional and cultural milestone. It’s about legacy, pride, and a sense of arrival,” says Dr. Prashant Thakur, Regional Director & Head – Research, ANAROCK Group.

Legacy over Liquidity

For many Indian families, property remains the only real form of generational wealth. Ancestral homes are often cherished for decades, even centuries, becoming part of the family’s identity.

In Kolkata’s Shobha Bazar, a 120-year-old mansion still houses five generations. The owners have refused redevelopment offers, saying the home is their “living history.”

A 2023 ANAROCK report found that 68% of Indian homebuyers are end-users, and 80% plan to pass on their property to their children, underscoring that homeownership here is as much about legacy as it is about investment.

Renting Still Seen as a Stopgap

While renting is a lifestyle choice in many Western countries, in India it is often viewed as a temporary solution — or even a wasteful expense.

A 2022 RBI survey showed that 77% of household wealth in India is in real estate, compared to just 35% in the US. For most Indians, paying rent is considered “money lost,” while EMIs are seen as equity in progress.

Take Rajat, a 32-year-old software engineer in Pune. Despite having company-sponsored housing, he chose to buy a ₹1 crore apartment. “Renting feels like a leak. At least an EMI is building something for me,” he said.

The Safe Bet Mindset

Indians have long viewed real estate as a safer investment compared to volatile alternatives like stocks, mutual funds, or crypto.

During the 2008 global financial crisis, while global property markets tanked, prices in India’s top cities remained largely stable. The COVID-19 pandemic also saw a quick rebound in the Indian housing sector — by 2023, over 4.76 lakh units were sold across the top cities.

“Unlike other investment classes, real estate is tangible, slow-moving, and emotionally satisfying — all key factors for the Indian buyer,” says Dr. Thakur.

Policy Support and the Power of EMIs

Government incentives have also played a pivotal role in promoting homeownership. Tax benefits, interest subsidies, and favourable GST rates on affordable housing have made buying more accessible.

Key initiatives include:

• Tax deductions under Sections 80C and 24(b) (recently increased to ₹3 lakh for interest repayment)
• 1% GST on under-construction affordable homes
• Subsidies under PMAY-CLSS, with interest benefits up to 6.5%
• Stamp duty rebates for first-time buyers in several states

These schemes, along with relatively easy loan access, have led to strong uptake. According to SBI, over 70% of its 2023 home loan portfolio was to salaried individuals aged 30–45 — mostly first-time buyers.

Social Status and Matrimonial Market Value

Homeownership is often tied to social perception. In matchmaking and societal interactions, owning property is seen as a mark of stability and success.

A marketing professional in Delhi NCR noted that when he updated his matrimonial profile to include “2BHK owner in Gurgaon,” responses noticeably improved.

Urbanisation and FOMO

As India rapidly urbanises — with urban population projected to hit 42% by 2035 — property prices are soaring. This has triggered a Fear of Missing Out (FOMO), especially among younger buyers who fear being “priced out” of the market.

In Mumbai, average ticket sizes have jumped from ₹1.5 crore in 2020 to ₹2.15 crore in 2024, according to ANAROCK.

Homes as Income Engines

Unlike previous generations, today’s buyers aren’t just looking for a place to live — they’re looking to earn. From renting spare rooms on Airbnb to investing in co-living or commercial spaces, homes have become income-generating assets.

Platforms like Strata and hBits are enabling fractional ownership in commercial real estate, attracting HNIs and NRIs with entry points of ₹10–25 lakh and returns of 8–10% annually.

Conclusion: More Than Bricks and Mortar

Real estate in India isn’t merely about square footage. It’s about security, belonging, and ambition — and often, the culmination of a lifelong dream.

“In India, buying a home is not a transaction — it’s a statement,” Dr. Thakur concludes. “It’s how we define stability, express success, and plan for future generations. It’s our story, written one EMI at a time.”

Also Read: MahaRERA Issues Guidelines to Ensure Safe Home Buying Practices

The post Rooted in Realty: Why Indians Still Put Their Heart into Homeownership appeared first on Square Feat India.

As of the end of Q1 2025, unsold homes priced below ₹40 lakh dropped by 19% across the top 7 cities, compared to the same time last year. Meanwhile, homes priced above ₹1.5 crore saw a 24% increase in unsold units.

What’s Happening in the Market?

• Affordable Housing (Below ₹40 lakh):
  • Inventory dropped from 1.40 lakh units to 1.13 lakh units
  • This is mainly due to limited new supply and steady demand from end-users
  • Bengaluru saw the biggest drop at 51%
  • Chennai followed with a 44% decline
  • Hyderabad was the only city where unsold affordable homes went up by 9%
• Luxury Housing (Above ₹1.5 crore):
  • Inventory rose from 91,125 units to 1.13 lakh units
  • Many new luxury homes were launched, but demand hasn’t kept up
  • Chennai and Pune were the only cities to see a decline in luxury stock (4% and 11% respectively)
  • Other cities saw increases, with NCR up 78%, Kolkata up 96%, and Bengaluru up 57%

Middle Segments:

• Mid-range homes (₹40–80 lakh) saw a 10% drop in unsold stock
• Premium homes (₹80 lakh–₹1.5 Cr) remained mostly unchanged

Total Unsold Homes in Top 7 Cities:

As of Q1 2025-end, there were around 5.60 lakh unsold homes across the top cities — a 4% drop from 5.81 lakh units a year ago.

Breakdown by price segment:

Expert View:

Anuj Puri, Chairman of ANAROCK Group, explained:
“Affordable housing suffered the most after COVID-19, but the recent drop in unsold stock shows that buyers are returning. These are mostly end-users looking for real homes, not investors.”

He added, “Luxury housing did very well over the past few years, but now we’re seeing inventory rise. This is due to many new launches, plus some buyer caution because of global economic uncertainty.”

City Snapshot – Affordable Segment (< ₹40 lakh):

Conclusion:

The real estate market is seeing a shift. Budget homes are back in demand, while luxury homes may face some oversupply. Buyers are clearly becoming more cautious, especially in the higher price brackets, while affordable and mid-range homes continue to attract genuine home seekers.

Also Read: Housing Prices Surge in 2024, Delhi NCR Leads with 31% Growth

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Between 2019 and 2024, average flat sizes in these cities recorded an impressive 34% jump, rising from 1,145 sq. ft. to 1,540 sq. ft. NCR (National Capital Region) stood out, registering a staggering 95% increase over the six-year period, growing from 1,250 sq. ft. in 2019 to 2,435 sq. ft. in 2024. In the past year alone, NCR saw a 29% increase, primarily driven by a surge in luxury housing supply.

Of the total 53,000 units launched in NCR in 2024, 70% were in the luxury segment, compared to just 40% of the 36,735 units launched in 2023. This growth in supply catered to the rising demand for premium homes priced above ₹1.5 crore. In contrast, the share of affordable housing supply in NCR dropped from 24% in 2023 to 11% in 2024, highlighting the region’s growing focus on luxury homes.

“Size is a defining characteristic of luxury homes, and NCR developers are closely responding to buyer demand,” said Anuj Puri, Chairman of ANAROCK Group.

Hyderabad, which had the second-highest average flat size at 2,103 sq. ft. in 2024, was the only city to record a dip in average size. The city saw a 9% decrease from 2,299 sq. ft. in 2023. Despite this, Hyderabad recorded a 24% rise over six years, up from 1,700 sq. ft. in 2019.

Mumbai Metropolitan Region (MMR) continued to have the smallest average flat sizes among the top seven cities. The average size rose marginally by 8% over six years, from 784 sq. ft. in 2019 to 849 sq. ft. in 2024. However, it still reflected the region’s chronic space constraints and high property prices.

Other southern cities, including Bengaluru and Chennai, saw significant increases in flat sizes. Bengaluru’s average flat size rose 30% in six years, from 1,280 sq. ft. in 2019 to 1,660 sq. ft. in 2024. In the last year alone, the city saw a 12% rise. Similarly, Chennai recorded a 31% increase over the six-year period, with average sizes rising from 1,100 sq. ft. in 2019 to 1,445 sq. ft. in 2024, including a 15% jump in the past year.

Kolkata and Pune also recorded steady growth in average flat sizes. Kolkata saw a 15% increase over six years, with sizes rising from 1,000 sq. ft. in 2019 to 1,149 sq. ft. in 2024. In Pune, flat sizes increased by 25%, growing from 910 sq. ft. in 2019 to 1,135 sq. ft. in 2024.

Despite rising property prices, the increasing preference for larger homes reflects the shift in consumer priorities post-COVID, particularly in urban areas. The demand for spacious homes, particularly in the luxury segment, continues to shape the dynamics of India’s residential real estate market.

Also Read: ahmedabad real estate market

The post Average Flat Sizes Rise 7% in Top 7 Cities in 2024; NCR Leads with a 29% Annual Increase appeared first on Square Feat India.

Mumbai 11 November 2024: With housing emerging as India’s most-preferred investment option, the time it takes for property seekers to convert to buyers is a critical metric to gauge overall demand. Latest ANAROCK data indicates that this conversion time (from first lead to actual booking) is reducing steadily and stands at about 26 days in H1 FY2025, against the highest peak of 33 days in FY 2021. 

The lead-to-conversion time was at its lowest at 25 days in FY 2019 and FY 2024. If we compare the current trends with those of a year ago, there is an increase of a day in H1 FY2025 – it was 25 days in FY 2024. 

Days to Booking a House: Yearly Trends

Source: ANAROCK Research

A deeper analysis of the budget category data shows that ultra-luxury homes (priced >INR 3 Cr) involve the lowest conversion time, clocking in at just 15 days in H1 FY 2025. Back in FY 2024, it was 22 days – thereby reducing by a whole week.

Anuj Puri, Chairman – ANAROCK Group, says, “Ultra-luxury homes buyers are financially equipped to make quicker decisions. Also, high-end homes are currently in greatest demand and desirable inventory tends to sell out fast, necessitating a need for speed.”  

Out of all budget categories, buyers of homes priced between INR 50 lakh to INR 1 Cr took the most time (about 30 days) to decide on buying a home from the day they first got a lead to paying the booking amount. 

“In contrast, in FY 2024, the conversion time for this category of homes was the lowest at just 20 days,” says Puri. “However, if we compare H1 FY2025 data with that of the previous fiscal (FY2024), we note a slight increase in the conversion time – from 25 days in FY 2024 to about 26 days in H1 FY2025. We can attribute this to escalating property prices across cities in the last one year, which are causing purchase decisions to take longer “.

The conversion for homes priced between INR 1 Cr to INR 3 Cr stood at 27 days in H1 FY 2025. In FY 2024, conversion time taken was highest for homes priced between INR 1 Cr to INR 2 Cr (32 days). Properties priced between INR 2 Cr to INR 3 Cr took 26 days to be booked.

Affordable homes saw a minor reduction in the conversion time – from 27 days in FY 2024 to 26 days in H1 FY 2025.

Essentially, buyers took a longer time to book homes in FY2021 than they are taking today, reflecting the currently strong demand momentum. Given that the last few years have seen a surge in new supply by branded developers, buyers feel empowered to make quicker decisions as confidence in these players is high.

“Even with these decreases in lead-to-buy periods, it is unlikely that we will see any marked incremental changes in this process overall,” adds Puri. “Indian home buyers do not make purchase decisions lightly, given the huge capital outlay often involving most or all of their savings. Obviously, luxury and ultra-luxury home buyers do not operate from a place of financial constraint; however, this segment constitutes just about 10-11% of the overall Indian residential market sales currently. Affordable, mid-range – and, of late, upper-mid-range buyers will continue to define the bulk of demand in the country.

Also Read: Convenience ranks as a top priority for homebuyers while buying a home

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Gold remained a favourite investment for Indian households due to its liquidity and investment size flexibility. Equities are highly volatile and easily impacted by social, political, and economic upheavals. Real estate, always considered a long-term investment, gives portfolio stability, and appreciates with time. The physical nature of the asset, unlike stocks, also ensures limited wealth erosion.

The Bear of the 1st Wave of Pandemic

As the COVID-19 pandemic beset the world towards the end of 2019, global stock markets buckled and crumbled under unprecedented business uncertainties. India, an integral part of the global economy, also saw rough times – the BSE Sensex declined sharply by 29% between December 2019 and March 2020.

Gold, considered a ‘safe haven’ investment in time of turbulence, went northward and appreciated by 4%. Residential real estate prices in India remained stable as there were uncertainties about the execution, development, and sales of the projects. All sectors, including real estate, were challenged on how to navigate the tempest.

The Lethal 2nd Wave (April 2021 – June 2021)

The 2nd wave was more toxic in India, creating an acute healthcare crisis that claimed many lives and led to the re-enforcement of lockdowns. However, all asset classes stayed steady on the back of business continuity learnings from the 1st wave.

The stock markets exhibited resilience and investors again became active as many scrips were available at attractive valuations. During this period, the Sensex regained a growth trajectory after a minor correction of 1% in April 2021 compared to the previous month. Gold, though lower than the previous peak, appreciated again, while residential real estate remained stable.

The Post Pandemic Recovery (September 2020 till date)

The Sensex has recorded the highest appreciation in value and volume since the pandemic receded. The 3rd wave early this year caused a minor aberration and was short-lived. Gold continued regaining lost ground and would have remained in a stronger position had it not been for the global economic turmoil, geopolitical tensions, and supply chain issues.

Prashant Thakur, Sr. Director & Head – Research, ANAROCK Group, says, “In all this turmoil, residential real estate has exhibited exceptional resilience and is now on a growth path. The weighted average price across the top seven cities has appreciated. While price is a function of supply and demand, the favourable change of sales exceeding supply continued even during the pandemic. Analysis shows that the available housing inventory is on a steady decline.”

Performance Over Pre-Pandemic Levels

Source: ANAROCK Research. Data for the top 7 cities of India only.

Source: ANAROCK Research

(Prices are for BSP on SBUA. Data for the top 7 cities of India only)

Source: Compiled by ANAROCK Research

All assets have exceeded their pre-pandemic levels. Compared to the September 2019 levels, the BSE Sensex has recorded an appreciation of 52%, gold prices have increased by 34%, and residential real estate by 9%. These readings indicate that the worst impact of the pandemic is behind us. Economic growth, despite global uncertainties and the headwind of rising inflation, is likely to be robust.

“The COVID-19 pandemic reaffirmed the necessity of owning homes, since it provides more than mere accommodation – it also gives security in times of generalized financial instability,” says Prashant Thakur. “Gold and stocks, on the other hand, are volatile and subject to market risks.”

Currently, real estate activities are in full swing and both demand and supply are increasing rapidly. As residential launches increased by 76% and sales by 61% in H1 2022 compared to the pre-pandemic levels of H2 2019, housing is all set to witness further traction during the festive season, leading to further price appreciation.

Also Read: RBI Monetary Policy – Can the Housing Market Absorb Another Hike?

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