Housing Sales Decline in India’s Top Cities Amid High Prices and Slow Economy

Residential Market Faces a 23% Drop in Sales

India’s housing market has hit a slowdown, with home sales in the country’s top nine cities declining by 23% in the first quarter of 2025 compared to the same period last year. A report by real estate data firm PropEquity attributes this decline to rising property prices and an overall economic slowdown, which have made potential buyers more cautious.

New Project Launches Decline by 34%

The sluggish demand has also impacted new project launches, which have seen a 34% drop across the top nine cities. The housing market is undergoing a correction after experiencing record supply levels from 2021 to 2023, said Samir Jasuja, founder of PropEquity. Additionally, global trade uncertainties have made investors hesitant, further affecting market sentiment.

Housing Sales Decline in Most Indian Cities, But Bengaluru and Delhi-NCR Show Growth

Housing sales in India’s top nine cities dropped significantly in the first quarter of 2025, with only 1,05,791 units sold. This marks a sharp fall from the 1,36,702 units recorded during the same period in 2024. Most cities saw lower sales and fewer new projects, except for Bengaluru and Delhi-NCR, which performed better.

Bengaluru led the market with a 10% rise in home sales, reaching 18,508 units in Q1 2025, compared to 16,768 units a year ago. Its share of total sales grew from 12% in Q1 2024 to 17% in Q1 2025. Delhi-NCR also followed a similar trend, selling 11,221 units, a 10% increase from last year.

On the other hand, new housing projects declined sharply in several cities. Kolkata saw the biggest drop in new supply, falling by 62%. Mumbai and Thane recorded a 50% decline, Pune 48%, and Chennai 46%. Hyderabad witnessed a 38% decrease in fresh launches, while Navi Mumbai and Delhi-NCR saw smaller reductions of 24% and 14%, respectively.

Bengaluru & NCR Buck the Trend

Despite the overall decline, Bengaluru and the National Capital Region (NCR) stood out with a 10% rise in sales, indicating strong demand in these regions. However, most other cities struggled to maintain momentum.

Hyderabad, Pune & Thane See Major Declines

Traditionally high-supply markets like Hyderabad, Pune, and Thane have witnessed a sharp decline. These three cities, which contributed 38% of new project launches last year, saw their share drop to 29% this quarter.

City-Wise Impact on Housing Sales

Hyderabad faced the steepest drop, with sales nearly halving in the first quarter.

Mumbai and Pune saw sales fall by about one-third compared to last year.

Commercial Real Estate Remains Strong

While the residential sector is cooling down, the commercial real estate market continues to thrive. Companies leased a record 77.2 million square feet of office space across seven major Indian cities in 2024, reflecting strong business expansion and demand for workspaces.

Conclusion

The Indian housing market is undergoing a correction due to high prices, economic uncertainty, and cautious investor sentiment. While cities like Bengaluru and NCR remain resilient, others like Hyderabad, Mumbai, and Pune are seeing a significant slowdown. On the other hand, the commercial real estate sector remains strong, signaling that businesses are still confident in India’s long-term growth prospects.

Source: PropEquity Report