Bank Credit to Real Estate Sector Surges Fourfold in Four Years
Not only have real estate prices surged in recent years, but bank loans to the Indian real estate sector have also soared at least four times, according to a real estate consultant. Colliers India assessed the aggregate financials of the top 50 listed real estate companies in India, focusing on profitability, gearing, and market performance parameters.
In a statement on Tuesday, Colliers India reported that bank credit to the real estate sector in India stood at ₹35.4 lakh crore at the end of March 2025. “India’s real estate sector has continued to exhibit marked improvement in terms of financial health in the post-pandemic era, outperforming other major industries in the economy in terms of critical credit and financial metrics,” the consultant said.
With the sector’s access to credit improving significantly in absolute terms, it now accounts for one-fifth of the deployment of bank credit in the country, signaling growing lender confidence in the sector. Gross bank credit in India has grown substantially, from ₹109.5 lakh crore in FY21 to ₹182.4 lakh crore in FY25. Bank credit in the real estate sector has impressively doubled in the same period, from ₹17.8 lakh crore to ₹35.4 lakh crore, according to Reserve Bank of India (RBI) data.
Badal Yagnik, Chief Executive Officer of Colliers India, noted that external volatilities had failed to shake the real estate sector’s resilience and financial prudence. “The relatively higher credit quality of real estate loans is well supported by underlying strong demand-supply dynamics across multiple asset classes such as residential, commercial, industrial and warehousing, retail, and hospitality,” Yagnik said.
Around 62% of the top 50 listed real estate firms had shown higher profitability margins at the end of FY25, compared to the 23% share in FY21. More than 60% of the leading real estate companies in India have comfortable debt levels, reflected in a debt-to-equity ratio of less than 0.5 in FY25, the data revealed.
