Indian Housing Market Shows Steady Growth in Q3 2025
India's eight major housing markets witnessed a nominal one per cent increase in sales during the July-September quarter, according to a report released by Knight Frank on Tuesday. This growth indicates that the market is maintaining its momentum, despite concerns about a potential slowdown. Knight Frank, a leading real estate consultant, noted that the sales data for the current festive quarter would provide a clearer picture of the market's trajectory.
Releasing its report on the Indian real estate market through a webinar, Knight Frank mentioned that housing sales across eight major cities rose 1 per cent annually to 87,603 units during the third quarter of the current 2025 calendar year. This sustained momentum in sales can be attributed to several factors, including a fall in mortgage rates, high economic growth, and tax incentives introduced in the budget.
The impact of the increase in consumer confidence due to the rationalisation of GST rates from September 22 is yet to be fully reflected in the housing demand. Shishir Baijal, CMD of Knight Frank India, commented, 'India's residential market in Q3 (July-September 2025) has demonstrated an impressive ability to sustain momentum, and the market is now in its fifth year of an upcycle. Consequently, the Y-o-Y (year-on-year) growth rate is beginning to rationalise, and we may be entering a prolonged plateau phase.'
The rate cut of up to 100 basis points, along with liquidity support through the simplification of both direct taxes and GST, has collectively strengthened end-user confidence, added Baijal. Despite the positive trends, sales during the first nine months of this year declined one per cent annually to 2,57,804 units across eight major cities compared with the same period last year. These cities include Delhi-NCR, Mumbai Metropolitan Region (MMR), Pune, Chennai, Hyderabad, Bengaluru, Kolkata, and Ahmedabad.
Gulam Zia, Senior Executive Director of Research, Advisory, Infrastructure, and Valuation at Knight Frank India, stated, 'We are not seeing any signs of demand slowdown as of yet.' He noted that sales have risen marginally during the latest September quarter, despite concerns in the market about the possibility of a demand slowdown. However, Zia pointed out that there have been some 'cracks' in demand for luxury and ultra-luxury homes.
Zia advised developers to consider the development of affordable homes, as there is a limitation of growth potential in the luxury housing segment. This shift towards affordable housing could help sustain the market's momentum and meet the needs of a broader range of buyers.
The Indian real estate market's resilience is a testament to the combined effects of favorable economic policies and consumer confidence. As the market continues to evolve, it will be crucial to monitor how new policies and market trends impact housing demand and supply in the coming quarters.
