Summary of this article
Housing sales stable despite slower growth
Premium homes gain demand; affordable segment declines
Mumbai, Chennai lead residential market performance
A latest report by Knight Frank India, “India Real Estate: Office and Residential Market – July to December 2025 (H2 2025) report” highlights how the housing market has remained resilient, even as the pace of expansion halted for a while. This resilience has been maintained even through multiple potential factors that could’ve deterred the situation. The annual residential sales of 2025 were 348,207 units. This number reflects market stability even though the year-on-year sales have dropped by 1 per cent in 2024.
The standout was the strong performance in the second half of the year. Residential sales in the H2 2025 reached 178,406 units, which was also the highest number recorded since 2013. Despite the volumes, the end-user demand and continued confidence in the market are the milestones.
The report notes that while the sales were steady, the decline was most noticeable in new residential launches on a year-on-year basis. However, the demand has continued to outnumber the spaces and sales. This shows the caution the developers are following. Developers experimented with various buyer sentiments, be it luxurious high-end projects in Delhi-NCR or focusing on mid-segment affordable housing in the peripheries of developing cities.
Among some of the major markets, Mumbai has retained the leadership. Mumbai has accounted for 29 per cent of the residential sales with 97,188 units sold this year, registering a modest growth of 1 per cent year on year.
Chennai followed Mumbai, being another strong performer; the sales in the city rose by 12 per cent year on year. Bengaluru has been stable through the year, maintaining the previous year's numbers. In contrast, the NCR witnessed a 9 per cent decline in sales, influenced by a high base effect and selective activity in premium corridors throughout the core areas.
The report also indicates that the affordable housing segment has continued to lose its standing in the market. Sales of homes priced below Rs 50 lakh have declined by 17 per cent year on year. This marks a significant shift in the buyer and developer sentiment, showing how buyers now want a more premium and established housing, while developers are also focusing on making their inventory more premium housing.
Looking ahead, the market shows confidence and resilience for the year 2026. While rapid growth may remain limited, the report and the experience of the market show that it won’t disappoint the investors and homeowners alike.
