The survey suggests that while expectations have become more measured, confidence remains intact. Nearly 67% of HNIs and UHNIs remain bullish on India’s economic growth over the next 12–24 months, even as global headwinds persist. Reflecting this realism, 72% of respondents expect India’s GDP growth to stabilise at 6–7% in FY27, signalling moderation—but not pessimism.

Real Estate Seen as a Safe, Long-Term Bet

Amid volatile equity markets and currency concerns, luxury housing continues to stand out as a dependable asset. About 67% of wealthy investors expect annualised real estate returns of up to 15%, reinforcing property’s appeal as a combination of capital appreciation, rental income, and lifestyle security.

Importantly, demand is not driven purely by speculation. The survey reveals a balanced buyer profile, with 53% purchasing luxury homes for capital appreciation and 47% buying for self-use, underlining a growing preference for ownership rooted in permanence and personal consumption.

City-based luxury homes remain the top choice. 31% of respondents prioritised primary residences, while 30% focused on residential investment assets within cities, reflecting continued faith in premium urban micro-markets despite higher entry prices.

Selective Buying Replaces Frenetic Demand

While appetite remains strong, buyers are no longer indiscriminate. The report highlights that the red-hot momentum of 2025—marked by record sales from listed developers and marquee transactions across Mumbai, Delhi-NCR, Goa, and Alibaug—has carried into 2026 with greater selectivity.

Tightening inventory of high-quality projects and rising prices have softened interest in second homes. Among those still exploring the segment, 46% prefer farmhouses near city peripheries, while 33% favour hill or mountain destinations, pointing to lifestyle-led purchases rather than aggressive yield chasing.

Luxury buyers today are prioritising privacy, design excellence, wellness features, and service-led living, forcing developers to recalibrate offerings toward fewer, more differentiated projects in proven locations.

Wealth Creation Continues to Fuel Demand

The survey underscores that India’s luxury housing demand is structurally supported by wealth creation. The rise of startup founders, next-generation entrepreneurs, and senior professionals, alongside traditional business families, has broadened the luxury buyer base.

In 2025, 103 Indian companies raised ₹1.76 lakh crore through IPOs, significantly boosting liquidity among affluent investors.

Commenting on the findings, Amit Goyal, Managing Director, India Sotheby’s International Realty, said,

“Even as markets show signs of moderation, luxury homebuyers continue to take a long-term view. For many, real estate represents permanence—an asset that blends capital efficiency, lifestyle value, and generational continuity. Demand has clearly shifted from scale to substance.”

Prime Assets to Outperform as Prices Cool

While overall optimism remains high, expectations around price growth have cooled. More than half of the respondents expect luxury residential prices to moderate in FY 2026–27, reflecting a maturing market rather than a slowdown.

Currency volatility has also emerged as a concern, with many HNIs and UHNIs monitoring the rupee’s depreciation against the dollar and selectively exploring overseas or dollar-linked assets. Despite this, real estate continues to hold its ground as a preferred physical asset.

Ashwin Chadha, CEO, India Sotheby’s International Realty, noted,

“India’s wealth creation and real estate growth have moved in tandem. While buying decisions are now more cautious, prime urban luxury homes will continue to outperform due to scarcity, defensibility, and long-term relevance.”

A More Professional, Disciplined Market

The survey points to a growing trend of portfolio consolidation and professionalisation. Over half of respondents are considering streamlining their property holdings, and an increasing number are relying on professional advisors rather than informal networks or local brokers.

Overall, the findings indicate that India’s luxury housing market is not immune to moderation—but it is far from losing momentum. For the country’s wealthiest buyers, luxury homes remain a strategic bet in uncertain times, anchored in quality, location, and long-term confidence in India’s growth story.

Also Read: Luxury Homes Appreciate 24%

The post While Markets Slow, India’s Rich Keep Betting Big on Luxury Homes appeared first on Square Feat India.

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:

1. Interest rate cuts by the RBI
2. 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

The post Fewer Homes Sold, But Buyers Spent More: India’s Housing Market Sends Mixed Signals in 2025 appeared first on Square Feat India.

Unlike the post-pandemic rebound years, the coming phase is expected to be defined not just by volumes, but by quality, planning discipline, and long-term livability.

Housing Demand to Stay Strong Across Segments

According to Binitha Dalal, Founder and Managing Partner at Mt. K Kapital, 2026 is expected to see a strong push across residential segments, with both luxury housing and the mid-segment maintaining healthy momentum.

She highlights that while investor confidence remains steady, affordable housing continues to face challenges. Policy intervention will be critical in bridging this gap.

“A key expectation is that policy measures will help make affordable housing truly affordable again, which remains one of the biggest gaps in the market today,” Dalal notes.

Luxury housing, meanwhile, is expected to remain resilient, driven by aspirational buyers and long-term capital allocation. At the same time, mid-segment housing is likely to benefit from stable demand, improving affordability conditions, and better infrastructure-led connectivity.

Commercial, Hospitality and New Asset Classes Gain Ground

Beyond residential real estate, commercial assets are poised for significant offtake in 2026. Office demand, backed by corporate expansion and Global Capability Centres (GCCs), continues to remain a structural growth engine. Hospitality is also expected to see a major surge as fresh investments flow into hotels, mixed-use developments, and tourism-linked assets.

Dalal also points to the growing influence of emerging segments.

“We anticipate the emergence of new asset classes, with data centres and PropTech playing an increasingly influential role in shaping the next phase of growth,” she adds.

These segments are increasingly attracting institutional capital and are expected to redefine how real estate assets are developed, managed, and monetised.

Tier-2 Cities and Infrastructure to Lead the Next Wave

Mohit Goel, Managing Director at Omaxe Ltd, believes that the next growth cycle will be driven by deeper demand in the mid-segment, continued infrastructure rollout, and the steady rise of Tier-2 cities.

Markets such as Lucknow, Indore, New Chandigarh, Amritsar and Faridabad are expected to see higher absorption as new airports, highways, and mixed-use corridors reshape urban aspirations.

“The industry is entering a phase where partnerships with the public sector will play a bigger role, with PPP-led developments creating integrated retail, residential and hospitality ecosystems,” Goel says.

Public-private partnerships are increasingly becoming central to large-scale urban development, especially in regional markets where land aggregation and infrastructure planning are critical.

Redevelopment Emerges as a National Priority

Redevelopment is set to gain greater prominence in 2026 as cities across India look to modernise ageing neighbourhoods and optimise scarce urban land.

Urban centres continue to expand, but redevelopment offers a more sustainable path—upgrading infrastructure, improving safety, and creating modern housing without pushing cities outward indefinitely. Both Dalal and Goel see redevelopment becoming a national policy focus, especially in dense urban cores.

Homebuyers Become More Aspirational and Discerning

Amrita Gupta, Director at Manglam Group, notes that homebuyer preferences are evolving rapidly. Buyers are no longer focused solely on size, but on design quality, sustainability, and long-term livability.

“Real estate in 2026 will be shaped by the growing aspirations of homebuyers who are seeking better-designed, future-ready communities rather than just larger spaces,” Gupta explains.

She points to Jaipur as a case study of this shift—from a value-driven market to a lifestyle-led destination supported by stable growth and a maturing urban ecosystem.

Sustainability, Redevelopment and Collaboration Shape Supply

Developers are increasingly aligning supply with these changing preferences. Redevelopment initiatives, environmentally responsible construction, and strategic collaborations are expected to play a central role in shaping new housing stock.

Gupta adds that redevelopment models will help optimise land use, upgrade older neighbourhoods, and introduce low-impact living solutions—particularly in cities with established urban footprints.

2026 Outlook: Measured Growth, Wider Participation

Overall, industry leaders agree that 2026 will be a year of measured expansion rather than speculative excess. With policy stability improving, capital flows strengthening, and buyers becoming more discerning, the sector is poised for sustainable, regionally diversified growth.

From luxury homes and mid-income housing to commercial assets, hospitality, data centres, and redevelopment-led urban renewal, Indian real estate in 2026 is set to become more balanced, resilient, and future-ready.

Also Read: Realty Stocks Start the Week Flat: Festive Momentum Fades as Markets Turn Cautious

The post Indian Real Estate in 2026: Redevelopment, Tier-2 Cities, New Asset Classes to Drive the Next Growth Cycle appeared first on Square Feat India.

Robust occupier demand, policy support, infrastructure expansion, and rising investor confidence are collectively reinforcing India’s position as a high-potential real estate market in the Asia-Pacific region.

Industrial & Warehousing: Demand Stays Strong, Supply Keeps Pace

India’s industrial and warehousing sector demonstrated remarkable resilience in 2025, with cumulative leasing across the top eight markets touching 26.5 million sq ft in the first nine months, marking an 11% year-on-year increase.

Grade A warehousing demand remained at record levels despite global trade uncertainties. Third-party logistics (3PL) players continued to dominate, accounting for nearly one-third of total leasing activity, while e-commerce and engineering companies sharply increased space absorption.

Industry estimates suggest annual demand could reach 30–40 million sq ft, with new supply also expected to remain elevated at 35–40 million sq ft, indicating a balanced market.

2026 Outlook: Policy Push and Infrastructure to Unlock New Markets

Looking ahead, the industrial and warehousing sector is expected to sustain 30–40 million sq ft of average annual demand, driven by a strong policy-led manufacturing push and expanding logistics networks.

Flagship initiatives such as Make in India, Production-Linked Incentive (PLI) schemes, and the Gati Shakti master plan are expected to catalyze large-format warehouse transactions. Deals of 200,000 sq ft or more are likely to account for 40–50% of Grade A leasing in 2026, particularly across logistics corridors.

Plug-and-Play Parks Gain Momentum

Plug-and-play industrial parks are emerging as a preferred choice for occupiers seeking faster setup and reduced time-to-market. These facilities offer compliance-ready units, core infrastructure, and flexible layouts, allowing businesses to scale operations efficiently. Their adoption is expected to accelerate further in 2026.

Tier II and III Cities Emerge as Logistics Growth Engines

While Tier I cities will continue to command a significant share of demand, Tier II and Tier III markets are poised for stronger traction. Expansion of expressways, dedicated freight corridors, industrial corridors, and Multi-Modal Logistics Parks (MMLPs) is enabling industrial activity to move beyond traditional hubs.

Improved regional connectivity is expected to unlock new logistics clusters and manufacturing zones across the country.

Hyperlocal Warehousing and EV Ecosystem Drive New Demand

The rapid rise of e-commerce, q-commerce, and quick-delivery platforms is reshaping urban supply chains. Demand for micro-fulfilment centres, dark stores, and in-city warehouses is expected to increase as retailers move closer to end consumers.

Simultaneously, growth in electric vehicle (EV) manufacturing and ancillary industries is driving demand for specialized facilities such as battery storage, electronics manufacturing, and component warehouses.

Alternative Assets: Data Centres, Senior Living and Co-Living Expand Footprint

Alternative real estate segments continued to scale in 2025, led by data centres, co-living, and senior living formats.

India’s data centre capacity has crossed 1,300 MW, translating into nearly 16 million sq ft of real estate footprint, more than doubling over the past five years. This growth is being fuelled by cloud adoption, AI, IoT, data localisation norms, and government policy support.

Co-living inventory has reached 0.3 million beds, while senior living stands at 0.03 million beds, indicating early-stage but accelerating adoption.

2026: Alternative Assets Enter Accelerated Growth Phase

Data centre capacity is expected to rise to 2 GW over the next few years, with strong traction in AI-led computing, edge data centres, and 5G-driven infrastructure. Expansion into smaller cities is also anticipated, supported by state-level policies.

Senior living demand is expected to rise in Tier II cities and spiritual hubs, while NRI interest is growing in established urban centres. Co-living is projected to see market consolidation, formalisation, and expansion beyond Tier I cities, with penetration potentially rising to 8–10% in the next two years.

Investments: Institutional Capital Remains Resilient

Institutional investments in Indian real estate remained steady at USD 4.3 billion in the first nine months of 2025, with full-year inflows expected to reach USD 6 billion.

Office and residential assets accounted for nearly 60% of total investments, while industrial, alternative, and mixed-use assets together attracted more than one-fifth of total capital.

2026 Investment Outlook: Deeper Institutionalisation Ahead

Institutional inflows are projected to rise to USD 6–7 billion in 2026, driven by balanced participation from domestic and foreign investors.

Emerging trends include:

• Build-to-core strategies and early-stage land investments
• Rising investments in retail and mixed-use developments
• Greater capital allocation to Tier II and III markets
• Expansion of REITs, SM-REITs, and AIF platforms
• Increased focus on ESG-compliant and sustainable assets

Together, these trends signal a deeper phase of institutionalisation for Indian real estate across asset classes.

Also Read: Mumbai Emerges as India’s BFSI GCC Powerhouse Amid Record Leasing Surge

The post India’s Industrial, Warehousing and Alternative Real Estate Assets Set for Next Growth Cycle in 2026 appeared first on Square Feat India.