Housing Sales in India's Major Cities Slide 16% in Q4 2025

Sales Decline Signals Market Pause

India’s real estate market witnessed a notable correction in the fourth quarter of 2025, with housing sales across the top nine cities declining by 16%. The slowdown marks a shift from the strong momentum seen earlier in the year and signals a phase of recalibration within the residential real estate sector.

Understanding the Sales Numbers

The drop in housing sales indicates softer demand across several key urban markets. While residential absorption remained stable in select micro-markets, overall volumes reflected buyer caution. The moderation suggests that many prospective homebuyers are adopting a wait-and-watch approach amid evolving economic conditions and changing affordability dynamics.

New Launches Also Moderate

Alongside declining sales, new housing launches fell by approximately 10% during the same period. Developers appear to be exercising greater discipline by aligning supply with realistic demand projections. Rather than flooding the market, many players are focusing on completing existing projects and preserving balance-sheet strength.

Key Factors Behind the Slowdown

Industry experts attribute the moderation to a combination of factors. Rising interest rates have increased home loan costs, directly impacting affordability for end-users. In addition, economic uncertainty and global macro pressures have influenced buyer sentiment, particularly in mid-income and premium segments.

End-User Demand Remains Selective

Despite the overall decline, end-user demand has not disappeared. Buyers are becoming more selective, favouring projects by reputed developers, well-located assets, and homes offering long-term value. Gated communities and projects with strong infrastructure connectivity continue to see relatively better traction compared to speculative markets.

Developer Strategy Shifts

The slowdown is prompting developers to reassess strategies. Many are prioritising cash flow management, phased launches, and cost optimisation. There is also increased focus on smaller ticket-size homes and projects aligned with actual demand, rather than aggressive expansion. This cautious approach reflects a maturing housing market.

Impact on Pricing and Inventory

While sales volumes have declined, prices have largely remained stable in most cities due to controlled supply and rising construction costs. However, certain micro-markets may witness marginal corrections or extended negotiation periods. Inventory levels are expected to normalise further as developers avoid overbuilding during uncertain phases.

Role of Policy and Interest Rates

Market participants are closely watching monetary policy and interest rate movements. Any easing in borrowing costs could revive demand, especially among first-time buyers. Government support for housing, infrastructure spending, and urban development will also play a crucial role in restoring confidence in India’s property market.

Opportunities Amid the Slowdown

Periods of moderation often create opportunities for both buyers and long-term investors. Negotiation flexibility, improved choices, and greater developer focus on quality could benefit informed buyers. For investors, selectively acquiring assets in resilient locations may offer attractive long-term returns once the cycle turns.

Outlook for the Coming Quarters

While Q4 2025 reflects a slowdown, industry analysts view it as a cyclical adjustment rather than a structural weakness. India’s real estate sector continues to be supported by urbanisation, demographic demand, and infrastructure expansion. With prudent strategies and supportive policy measures, the market is expected to stabilise and gradually regain momentum in the coming quarters.

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