India's Housing Market Shifts: 50% of New Properties Priced Above Rs 1.5 Crore
India's housing market is undergoing a significant transformation, with a surge in premium and luxury homes. A recent Anarock report reveals that nearly 50% of new residential projects launched in Q2 2025 are priced above Rs 1.5 crore, while affordable housing has shrunk to just 12% of the new supply.
Housing MarketLuxury HomesAffordable HousingReal EstateProperty PricesReal Estate NewsJul 17, 2025
Meanwhile, affordable housing has shrunk to just 12% of the new supply, making it harder for budget-conscious buyers to find options. This trend highlights how developers are placing significant bets on wealthier homebuyers and the increasing demand for premium lifestyles.
Luxury and ultra-luxury housing continued to dominate new launches. Homes priced between Rs 1.5 crore and Rs 2.5 crore made up the largest share of new supply at 27%, and ultra-luxury homes above Rs 2.5 crore accounted for another 19%. This trend shows that many buyers now prefer bigger, better-appointed homes.
Rising incomes, global capital flows into Indian real estate, and changing consumer lifestyles have all fuelled this premium housing boom. The data revealed that luxury and ultra-luxury homes now form a significant portion of all new supply. Homes in the Rs 1.5–Rs 2.5 crore price range held the largest share of new launches at 27%. High-end homes priced between Rs 80 lakh and Rs 1.5 crore made up 21% of launches, while mid-end homes between Rs 40 and Rs 80 lakh contributed another 21%.
Ultra-luxury properties above Rs 2.5 crore accounted for 19% of new supply, clearly showing how premium housing is driving the market. In contrast, affordable housing below Rs 40 lakh shrank to just 12% of the total. One of the most striking findings in the report was the sharp decline in affordable housing supply. Homes priced below Rs 40 lakh accounted for just 12% of all new launches. This marks a significant drop as developers increasingly focus on mid-segment and luxury projects where margins are higher and demand is more resilient.
In Chennai, there were no new launches in the affordable housing segment during the quarter, underlining how the market has shifted away from budget homes. During the quarter, about 96,300 homes were sold across India’s top seven cities. This was a 3% rise compared to the previous quarter but a notable 20% drop from the same period last year. Even though fewer units were sold, the total value of these transactions increased by 1% year-on-year to Rs 1.47 lakh crore.
Cities like Mumbai, Pune, Bengaluru, and the NCR contributed nearly 79% of all sales activity in this period. The report highlighted that average property prices across the major cities rose by 11% compared to a year ago. NCR saw the sharpest price increase of 27%, reflecting strong demand and limited supply in quality projects. Bengaluru followed with a 12% rise in prices, while Mumbai saw prices go up by 9%.
Pune, Hyderabad, Chennai, and Kolkata also recorded annual increases ranging from 6% to 11%, confirming that home prices continue to climb almost everywhere. New launches across the top seven cities stood at around 98,600 units during Q2 2025, down 16% compared to the same quarter last year and 1% lower than the previous quarter. Overall unsold inventory dropped by 3% year-on-year to about 5.62 lakh units.
Despite the overall moderation, the Mumbai Metropolitan Region led the new launch activity with over 28,000 units. Chennai stood out as an exception, registering a 79% jump in new launches compared to the previous quarter and 63% higher than the year before, showing strong developer confidence there. Sales patterns varied widely across cities. Chennai was the only city to record an annual increase in home sales, with volumes rising 13% compared to last year and 40% over the previous quarter.
In contrast, Mumbai, Pune, Hyderabad, and Kolkata all saw double-digit declines in sales from a year ago. NCR managed a smaller 14% drop in annual sales but showed a healthy 14% growth compared to the first quarter of the year. Bengaluru reported a more moderate 8% year-on-year decline in sales but remained one of the strongest markets in terms of overall activity.
Frequently Asked Questions
What is the current trend in India's housing market?
The current trend in India's housing market is a significant shift towards premium and luxury homes, with nearly 50% of new residential projects priced above Rs 1.5 crore.
How has affordable housing been affected?
Affordable housing has shrunk to just 12% of the new supply, making it harder for budget-conscious buyers to find options.
Which segment of the housing market is seeing the most growth?
Homes priced between Rs 1.5 crore and Rs 2.5 crore make up the largest share of new supply at 27%, followed by ultra-luxury homes above Rs 2.5 crore at 19%.
What factors are driving the premium housing boom?
Rising incomes, global capital flows into Indian real estate, and changing consumer lifestyles are the main factors driving the premium housing boom.
How have property prices changed in major cities?
Average property prices across major cities have risen by 11% compared to a year ago, with the NCR seeing the sharpest increase of 27%, followed by Bengaluru at 12% and Mumbai at 9%.
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