India’s residential real estate market entered a decisive new phase in 2025, moving away from volume-led expansion to a more mature, value-driven growth cycle, according to the latest report by the Indian Chamber of Commerce (ICC) and ANAROCK.
Housing sales across the top seven cities declined 14% year-on-year to about 3.96 lakh units, yet the total transaction value rose 6%, crossing ₹6 lakh crore. This divergence highlights how higher ticket sizes and premium housing are now driving the market.
After a muted price phase between 2015 and 2019, average residential prices surged 54% during 2019–24. In 2025, growth moderated to a healthier ~8%, pointing to sustainability and an end-user-driven market.
Key Shifts in Demand:
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Homes priced below ₹75 lakh now account for just 32% of sales, down from nearly 60% in 2021.
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Luxury homes priced above ₹4 crore contribute 18–20% of total sales, compared to just 1–2% before the pandemic.
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Ultra-luxury homes priced at ₹40 crore+ saw a sharp 66% jump in sales in 2025, with the Mumbai Metropolitan Region accounting for over 70% of such transactions.
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Buyer preference for 3BHKs and larger units has risen to 45–50%, up from about 30% in 2018.
On the supply side, the market has become increasingly institutionalized. Listed and Grade-A developers now account for ~45% of total residential supply, up from 28% five years ago, reflecting stronger balance sheets, execution capability, and growing buyer trust.
The report also notes that in the last five years, approximately 12,700 acres of land have been transacted, with nearly 60% earmarked for residential use.
Anuj Puri, Chairman – ANAROCK Group, says, “One of the most striking changes is in demand composition. Homes priced below INR 75 lakh, which accounted for nearly 60% of sales in 2021, now make up just ~32% of the market. In contrast, luxury and ultra-luxury housing has expanded rapidly, supported by rising incomes, lifestyle upgrades, and improved affordability among urban buyers.”
“Luxury homes priced above ₹4 crore now contribute ~18–20% of total sales in the top seven cities, compared to just 1–2% before the pandemic,” says Puri. “The ultra-luxury segment - homes priced at INR 40 crore and above - recorded a sharp ~66% jump in sales in 2025, with the Mumbai Metropolitan Region (MMMR) accounting for over 70% of such transactions.”
Macro Fundamentals Remain Strong:
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India’s mortgage-to-GDP ratio stands at just ~11%, significantly lower than global peers, underscoring under-penetration.
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Private consumption contributes nearly 60% of GDP, while government capital expenditure has tripled since FY19.
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The banking system remains strong, with net NPAs at multi-decade lows.
As India progresses toward a USD 7.3 trillion economy, the report underscores that residential real estate is no longer just a cyclical play but a structural pillar of economic growth, capital formation, and urban transformation.
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