India’s housing market witnessed a significant downturn in the first quarter of 2025, as sales in the top 9 cities fell by 23% while new supply plummeted by 34%, according to a report by data analytics firm, PropEquity.
In Q1 2025, units merely above 80,000 were launched showing an exponential decline in supply marking the third consecutive quarter with less than 1 lakh units. All top nine cities barring Delhi NCR and Bengaluru have faced this steep decline while they recorded a 10% increase in sales.
Following the same trend, Bengaluru was the standout performer with a 17% rise in new launches, accounting for 25% of total launches. Whereas, defying the numerical status quo were real-estate markets in Hyderabad, Pune and Thane recording a significant with the trio collectively witnessing a 29% decline in supply share compared to 38% in Q1 2024.As stated by Samir Jasuja, founder PropEquity, shared that the housing market has been undergoing a “correction after three years of record supply.”
Source: PropEqutiy
“With the ongoing increasing home prices and investor caution amid geopolitical and economic concerns have led to this downward trend” he added.
Source: PropEqutiy
Despite the slump, the absorption-to-supply ratio remained healthy at 131% in Q1 2025, reflecting ongoing demand despite market challenges. Experts suggest that market stabilization may occur as developers reassess their strategies in light of changing economic conditions.
In conclusion, while India’s housing market experienced a notable decline in sales and new supply in Q1 2025, the sector remains resilient, with some cities defying the trend. The downturn appears to be a market correction following years of record growth, influenced by rising home prices and investor caution. However, the stable absorption-to-supply ratio indicates continued demand, suggesting that the market may find equilibrium as developers adapt to evolving economic conditions.
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