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Demand for Compact Homes Surges in September Quarter: Magicbricks

Published: October 06, 2025 | Category: Real Estate Mumbai
Demand for Compact Homes Surges in September Quarter: Magicbricks

Mumbai: India's housing property market witnessed a 3.1% sequential rise in demand in the September quarter, led by an increased preference for smaller homes. The share of one- and two-bedroom apartments rose to 54% of total demand, reversing a two-year decline and indicating a renewed focus on affordability, as shown by realty platform Magicbricks' PropIndex.

Overall supply expanded marginally by 1% sequentially but was down 4.5% from a year earlier. Prices continued to move higher across key cities, with Pune (41.4% on-year rise), Mumbai (29.6%), and Greater Noida (27.3%) reporting the sharpest increases.

Under-construction homes commanded a higher premium than ready-to-move units, with prices in Pune rising 29.1% sequentially for such properties against 15.8% for completed ones.

The September quarter reinforced a fundamental market shift toward compact and mid-segment housing, said Sudhir Pai, CEO, Magicbricks. While affordability constraints are shaping buyer behavior, infrastructure-led optimism and evolving consumer aspirations continue to fuel demand across key micro-markets. Developers who align product offerings with affordability and lifestyle needs will define the next phase of sustainable housing growth.

The Mumbai Metropolitan Region continued to record steady buyer activity despite a 9.7% sequential supply contraction in Mumbai and 10.7% in Navi Mumbai, supporting continued price growth.

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Frequently Asked Questions

1. What is the main reason for the surge in demand for smaller homes?
The main reason for the surge in demand for smaller homes is the increased focus on affordability. Smaller one- and two-bedroom apartments are more affordable for a larger segment of the population.
2. How did the overall supply of homes change in the September quarter?
Overall supply expanded marginally by 1% sequentially but was down 4.5% from the previous year.
3. Which cities saw the sharpest increases in property prices?
Pune, Mumbai, and Greater Noida saw the sharpest increases in property prices, with Pune reporting a 41.4% on-year rise, Mumbai 29.6%, and Greater Noida 27.3%.
4. Why are under-construction homes commanding
higher premium? A: Under-construction homes are commanding a higher premium because they are often perceived as more valuable due to potential for customization and future appreciation. In Pune, prices for under-construction homes rose 29.1% sequentially, compared to 15.8% for completed units.
5. What is the significance of the market shift toward compact and mid-segment housing?
The market shift toward compact and mid-segment housing indicates a growing focus on affordability and lifestyle needs. This shift is driven by affordability constraints, infrastructure-led optimism, and evolving consumer aspirations.