India’s residential real estate market ended calendar year 2025 on a subdued note, with housing sales in the country’s top nine cities falling 16% year-on-year during the October–December quarter. According to a report by PropEquity, sales declined to 98,019 units in Q4 2025, marking the weakest quarterly performance since Q3 2021.
The slowdown is significant because the October–December period is traditionally the strongest for housing demand, driven by the festive season and new project launches. This time, however, rising prices, shrinking affordable supply and a growing tilt towards premium housing weighed heavily on buyer sentiment.
Among the nine cities tracked, Pune recorded the steepest decline, with sales plunging 31% year-on-year to 17,762 units. Mumbai saw a 25% fall, while Thane reported a 26% drop. Several other major markets also witnessed double-digit contractions, reflecting broad-based weakness across urban centres.
Only two markets bucked the trend. Navi Mumbai registered a 13% increase in sales, while Delhi NCR saw a modest 4% rise during the quarter. Analysts attribute this relative resilience to selective new launches and continued demand for high-end projects in specific micro-markets.
Industry executives point to a growing imbalance in the housing ecosystem. Developers are increasingly focusing on premium and luxury homes, while affordable and mid-income segments are being sidelined. As a result, buyer demand at the mass level remains weak despite supportive policy measures such as repo rate cuts and income tax rebates announced earlier in the year.
“The market is seeing demand only from the top end,” said a senior developer based in Delhi NCR. “There is little appetite among builders to launch affordable projects, primarily due to cost pressures and thinner margins.”
The supply side mirrored the slowdown in demand. Housing supply across the top nine cities fell 10% year-on-year to 88,427 units in Q4 2025. On a quarter-on-quarter basis, supply declined 4%. Growth in new supply was limited to Delhi NCR (29%), Navi Mumbai (15%) and Chennai (9%), while the remaining cities saw declines of up to 30%.
The report highlights a continuing trend of premiumisation that began in 2024. While the number of housing units launched has fallen, the overall value of launches has increased. In 2023, around 4.81 lakh units worth ₹6.3 lakh crore were launched. In 2024, launches dropped to 4.11 lakh units, yet the total value rose to ₹6.8 lakh crore, underscoring the shift towards higher-priced homes.
Despite the weak Q4 numbers, analysts remain cautiously optimistic about the outlook for 2026. With developers having raised significant capital during 2025, the expectation is that fresh project launches will pick up in the coming year, supported by a low base and improving macro conditions.
For now, however, the data underscores a clear reality: India’s housing market is growing more exclusive, leaving a large segment of potential homebuyers waiting on the sidelines.
Disclaimer: This article is for general information purposes only and should not be considered financial or investment advice.