Housing Market Enters Mid-Phase: Nuvama Research Highlights Mixed Trends
Nuvama Research reports a 23% YoY increase in housing sales by value in August 2025, driven by higher volumes and realizations. Despite improved demand, supply remains flat, and affordability concerns loom large.
Housing MarketDemand TrendsInventory LevelsReal EstateNuvama ResearchReal Estate NewsSep 25, 2025
At the same time, supply remained subdued. Launches by value were flat on-year and down 3% sequentially in August, reflecting cautious developer activity despite sustained demand. Unsold inventory improved to 17 months in August versus 18 months both a year ago and in July.
Year-to-date (CY25) demand and supply by value are up 11% and 4% YoY, respectively.
Sales by value grew 23% YoY/3% MoM in August, led by a 12% YoY/7% MoM rise in volumes, partly aided by a low base. Notably, after declining for 12 consecutive months between June 2024 and May 2025, sales volumes have now posted growth for three months in a row.
YTD absorption by value rose 11% YoY, driven by robust growth in the NCR (up 55% YoY), followed by Bengaluru, Chennai, and Kolkata (up 24–30% YoY each). However, Hyderabad sales dropped 11% YoY, while Pune and the Mumbai Metropolitan Region (MMR) saw declines of 6–8% YoY.
On the supply front, launches by volume rose 6% YoY/4% MoM in August, though by value they remained muted. YTD launches by value are up 4% YoY, led by southern markets, which registered 32–44% YoY growth. In contrast, launches fell sharply in the MMR and Pune (down 18–27% YoY), but gained 8–12% YoY in the NCR and Kolkata.
Inventory levels reduced to 17 months in August, indicating improved absorption. The NCR (10 months) and Pune (13 months) remain the healthiest markets, while Hyderabad lags with 26 months of unsold stock.
Prices continued to climb across regions. The MMR and Chennai saw the steepest gains at 19–20% YoY, while Bengaluru and Kolkata posted increases of 11–15% YoY. Other cities recorded 4–8% YoY growth in home prices.
Nuvama Research noted that the housing market has now entered the middle stage of the cycle, where product mix, breadth of demand, and interest rate trends will likely play a greater role in determining sector and stock performance than pre-sales growth.
However, the brokerage flagged affordability concerns as a major headwind, citing weak volume growth amid rising home prices and limited mid-income housing availability. In addition, broader economic challenges—such as uneven job creation and global tariff wars—could weigh on sentiment.
“Volatility shall persist, and we expect stocks to remain range-bound with downside protected by falling mortgage rates, even as the upside is capped by valuation and volume growth concerns,” the brokerage said.
Nuvama continues to prefer Prestige Estates (BUY) and Brigade Enterprises (BUY) as its top picks in the sector.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)
Frequently Asked Questions
What is the current state of the housing market according to Nuvama Research?
Nuvama Research reports that the housing market has entered the middle stage of the cycle, with sales by value expanding 23% YoY and 3% MoM in August 2025. However, supply remains flat, and there are concerns about affordability due to rising home prices.
How has the demand for housing changed in the past year?
Year-to-date (CY25) demand by value has increased 11% YoY, driven by robust growth in the NCR, Bengaluru, Chennai, and Kolkata. However, sales in Hyderabad, Pune, and the MMR have declined.
What is the current state of inventory levels in the housing market?
Inventory levels have reduced to 17 months in August 2025, indicating improved absorption. The NCR and Pune are the healthiest markets with 10 and 13 months of unsold stock, respectively, while Hyderabad lags with 26 months of unsold stock.
How have home prices changed in different regions?
Home prices have continued to climb across regions. The MMR and Chennai saw the steepest gains at 19–20% YoY, while Bengaluru and Kolkata posted increases of 11–15% YoY. Other cities recorded 4–8% YoY growth in home prices.
What are the main concerns for the housing market moving forward?
The main concerns for the housing market include affordability issues, weak volume growth, and broader economic challenges such as uneven job creation and global tariff wars. Nuvama Research expects volatility to persist and stocks to remain range-bound.
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