India's real estate market is experiencing mixed trends, with declining housing unit sales contrasting against growth in transaction values. This divergence highlights a fundamental shift in market dynamics, with premium segments driving value growth despite overall volume contraction.

Housing Sales Performance Shows Volume-Value Split

The residential real estate sector is experiencing contrasting performance across key metrics. According to Anarock data, housing sales across seven major cities demonstrate this market dichotomy:

Anuj Puri, Anarock Chairman, attributes the performance to multiple factors: "The market has been facing challenges due to geopolitical events, layoffs in the IT sector, ongoing tariff debates, and various other factors keeping the market on edge." He notes that price appreciation has moderated from double-digit increases in previous years to single-digit growth.

Listed Developers Report Strong Booking Performance

India's top-28 listed real estate firms have demonstrated resilience during the April-September period, led by major players including Godrej Properties, DLF, Prestige Group, Lodha Developers, and Signature Global. These companies collectively achieved significant sales bookings:

The luxury housing segment maintains its growth trajectory, while affordable and mid-income housing categories face supply constraints. Industry leaders cite high land prices as a primary factor limiting inventory development for mass-market segments, particularly units priced under ₹1 crore.

Commercial Real Estate Attracts Investments

While residential sales volumes have declined, India's commercial real estate sector has delivered strong performance across office, retail, and warehousing segments. The strong fundamentals have attracted significant institutional interest:

Foreign firms establishing global capability centres are driving demand for conventional and managed office spaces, capitalizing on India's skilled workforce and competitive rental rates. Industrial and warehousing leasing has reached high levels across tier-I, tier-II, and tier-III cities, supported by light manufacturing, third-party logistics, and e-commerce companies.

Capital Market Activity and Corporate Developments

The real estate sector has witnessed significant capital market activity, with multiple companies accessing public markets for expansion funding:

• Knowledge Realty Trust (sponsored by Sattva Group and Blackstone) raised ₹4,800 crore through REIT public issue
• Raymond Group demerged its real estate business for separate stock exchange listing
• Adani Group acquired debt-ridden Jaiprakash Associates Ltd through insolvency proceedings

Progress continues on resolving legacy issues, with Amrapali project buyers receiving flat possession in Delhi-NCR, though challenges persist for Unitech, Supertech, and Jaypee Infratech investors.

Industry Outlook and Policy Expectations

CREDAI National President Shekhar Patel expects calibrated growth, contingent on policy support. Industry associations have outlined key priorities for sustained recovery:

• Enhanced repo rate cut transmission to reduce borrowing costs
• GST simplification measures
• Streamlined approval processes
• Improved long-term capital access

CREDAI and NAREDCO have reiterated demands to revise affordable housing definitions, proposing an increase in the price cap from ₹45 lakh to ₹90 lakh. This change would extend the 1% GST rate benefit to a broader range of properties, potentially stimulating demand in the mid-income segment.

The Reserve Bank of India has reduced the repo rate, and industry leaders anticipate further monetary easing to support housing demand recovery. Puri concludes: "Looking ahead, much depends on potential RBI rate adjustments and developers' pricing strategies. If we see more repo rate cuts that bring down home loan interest rates, demand could potentially see a significant uptick."