India's Housing Market Faces 20% Sales Drop in Q2 2025 Amid Property Price Hikes and Global Tensions
India's housing market saw a significant downturn in the second quarter of 2025, with sales in the top seven cities declining by 20% year-on-year to 96,285 units, according to data from Anarock. This decline is attributed to a mix of domestic and global disruptions, including military actions and rising property prices.
Real EstateHousing MarketProperty PricesGlobal TensionsSales DeclineReal EstateJun 27, 2025
Analysts attributed the slump to a mix of domestic and global disruptions, including Operation Sindoor and the Iran-Israel conflict, which dented consumer confidence, alongside steep rises in property prices. “The second quarter of 2025 was a rollercoaster for the Indian housing market, rocked by major military actions at home and abroad,” said Anarock Chairman Anuj Puri. “The war-like climate pushed homebuyers into wait-and-watch mode, compounding the impact of soaring property prices over the past two years.”
Sales figures have consistently surpassed 100,000 units per quarter in 2023 and 2024, but 2025 has opened on a weaker note, with 93,280 units sold in Q1 and only a slight improvement this quarter. The Mumbai Metropolitan Region (MMR) and Pune remained dominant, jointly contributing over 48 per cent of total sales. However, Chennai was the only city to buck the trend with an 11 per cent annual increase in sales.
New housing launches also fell by 16 per cent year-on-year to 98,625 units in Q2 2025 from 1.17 lakh units a year ago. While MMR witnessed a 36 per cent annual drop and an 8 per cent quarterly dip in new supply, the National Capital Region (NCR) showed some resilience with a 69 per cent quarter-on-quarter surge and a 10 per cent annual increase. These two regions alone accounted for nearly half of all new launches in the top seven cities.
On pricing, average residential rates rose just 1 per cent on a quarterly basis but were up 11 per cent year-on-year. Puri was quoted by ET as saying, “With home loan rates softening and developers largely holding prices steady, the stage is set for a potential upswing in housing sales in the coming quarters.” NCR saw the sharpest year-on-year price rise at 27 per cent, followed by Bengaluru at 12 per cent.
Unsold inventory stood at 5.62 lakh units by the end of Q2 2025, slightly higher than 5.60 lakh units in Q1. Yet, on an annual basis, unsold stock was down 3 per cent, with Pune recording the most significant drop of 15 per cent, from 94,770 units in Q2 2024 to 80,240 units in Q2 2025. Puri remains cautiously optimistic, “If prices remain in check, expect housing sales across major cities to accelerate in the coming quarters.”
Frequently Asked Questions
What is the current state of India's housing market in Q2 2025?
India's housing market experienced a significant downturn in Q2 2025, with sales in the top seven cities dropping by 20% year-on-year to 96,285 units.
What factors contributed to the decline in housing sales?
The decline is attributed to a mix of domestic and global disruptions, including Operation Sindoor and the Iran-Israel conflict, which dented consumer confidence, alongside steep rises in property prices.
Which cities saw the most significant impact on housing sales?
The Mumbai Metropolitan Region (MMR) and Pune were significantly impacted, while Chennai was the only city to see an 11% annual increase in sales.
How did new housing launches perform in Q2 2025?
New housing launches fell by 16% year-on-year to 98,625 units in Q2 2025, with the National Capital Region (NCR) showing some resilience.
What is the outlook for the Indian housing market in the coming quarters?
Anarock Chairman Anuj Puri remains cautiously optimistic, stating that if prices remain in check, housing sales across major cities could accelerate in the coming quarters.
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