India, October 07, 2025: In the quarterly market update from Knight Frank India highlighted that the top 8 residential markets maintained sales momentum in Q3 2025 with a total of 87,603 housing units. Despite expectation of correction, residential sales recorded a 1% year-on-year (YoY) growth in Q3 2025, while year-to-date (YTD) sales figure was only marginally lower by 1%. As sales momentum continued to stay steady, Q3 2025 registered an increase in prices across all the markets, while supply recorded at 88,655 units for Q3 2025, noted a 2% decline over same time last year
The macroeconomic backdrop provided stability with inflation easing to 2.07% in August 2025 from 3.65% a year ago. The RBI raised its FY 2026 GDP forecast to 6.8%, while the repo rate stood 1% lower compared to end-2024, boosting liquidity and sentiment in the real estate sector.
Residential Sales Performance
Mumbai continued to lead with 24,706 units sold (+2% YoY), accounting for 28% of the overall sales. Chennai recorded the strongest growth at 12% YoY with 4,617 units, its highest sales since the pandemic. Other major markets like NCR (12,955 units) and Bengaluru (14,538 units) remained steady, while Pune was the only laggard with sales declining by 8% YoY.
Source: Knight Frank Research
In Q3 2025 prices have continued to rise even as developers are increasingly introducing financing options, including bank tie-ups and subvention schemes, to stimulate sales. Defying expectations of a correction, the residential market remained rangebound yet resilient in Q3 2025. Premium housing sales, meanwhile, held firm as financing innovations, fiscal incentives, and buyer-focused measures continued to channel demand into higher-value segments.
Shishir Baijal, Chairman & Managing Director, Knight Frank India, said, “India’s residential market in Q3 2025 has demonstrated an impressive ability to sustain momentum and the market is now in its fifth year of an upcycle. Consequently, Y-o-Y growth rate is beginning to rationalise, and we may be entering a prolonged plateau phase. Within a volatile geopolitical environment, India’s macroeconomic conditions remain stable. The rate cut of up to 100 basis points, and liquidity support through the simplification of both direct taxes and GST have collectively strengthened end-user confidence. A notable outcome of this upcycle has been the surge in demand for premium housing, which has emerged as a key driver in recent years, reflecting the evolving aspirations of urban buyers for larger and higher-quality homes.”
India’s top eight markets saw 88,655 new units launched in Q3 2025, a slight dip of 2% YoY. Growth in new launches was led by Chennai (+44% YoY) and Bengaluru (+28% YoY). However, significant declines in Mumbai and NCR (-19% YoY each) constrained overall supply.
The quarter underscored the continued shift towards premium housing. Units priced below INR 1 Cr saw their share of sales drop to 48% in Q3 2025 compared to 54% in Q3 2024. By contrast, sales of homes priced over INR 1 Cr rose to 52% and grew by 15% YoY compared to a degrowth in ticket-size segments under INR 1 Cr. With in the premium segment, the strongest growth was noted in the category INR 1 – 2 Cr which made up 28% of total sales. While on low base, the best YoY performance was noted in the category of INR 10-20 Cr which recorded 170% rise in sales in Q3 2025 compared to same period last year.
Source: Knight Frank Research
The Quarters to Sell (QTS) – a key indicator of the health of the market, remained steady at 5.8 quarters, equivalent to less than 18 months of stock currently available, signalling a healthy market. Even while unsold inventory rose 4% YoY to 506,400 units, the velocity of sales noted over the last 8 quarters, indicates towards continued demand. Having said so, the unsold inventory in higher ticket-size categories over INR 10 mn such as such as INR 20–50 mn (+47% YoY) and INR 200–500 mn (+19% YoY) has been notably higher than the lower end of the market. Luxury and super-luxury segments (>INR 200 mn), though small in size (<1,500 units combined), displayed volatility in QTS such as in the category of INR 20 – 50 Cr the recorded QTS was of 14.4 quarters while in INR >50 Cr the was recorded at QTS 9.0.
Strong demand for premium housing supported healthy price growth across markets. Market activity continues to be concentrated at the top end of the market while momentum persistently slides in ticket sizes under INR 10 mn. Price growth has been healthy in Q3 2025 despite overall sales not seeing any growth. The price growth has been strong in NCR, Bengaluru and Hyderabad at 19%, 15% and 13% YoY respectively.
Source: Knight Frank Research
Gulam Zia, Senior Executive Director – Valuation, Advisory and Research, Knight Frank India, added, “Premium housing has decisively taken centre stage, accounting for more than half of all sales this quarter. The strength of the INR 1–2 Cr segment, now the largest by volume, underscores a structural shift in buyer demand. Even with rising inventory, absorption levels remain stable, reaffirming the market’s ability to adjust and grow within a healthy and sustainable framework.”