India's Housing Market Stabilizes with Compact Homes Driving Demand
New Delhi, October 6th, 2025: Magicbricks, India’s leading real estate platform, reports a 3.1% QoQ increase in demand, driven by a surge in 1-2 BHK units. Despite affordability challenges, the market shows signs of stabilization.
Housing MarketReal EstateCompact HomesAffordabilityInfrastructureReal Estate NewsOct 06, 2025
While overall supply grew just 1% QoQ (–4.5% YoY), prices continued their upward trajectory. Pune (+41.4% YoY), Mumbai (+29.6% YoY), and Greater Noida (+27.3% YoY) recorded the sharpest annual price appreciation, driven by resilient demand and limited new launches. Notably, under-construction homes commanded a higher premium than ready-to-move units, with UC prices in Pune rising +29.1% QoQ compared to +15.8% for RM homes.
Regionally, the Delhi NCR market stood out with Delhi demand surging +10.3% QoQ, alongside Noida (+6.3% QoQ) and Greater Noida (+3.8% QoQ), boosted by large-scale infrastructure projects like the Dwarka Expressway and RRTS corridors. The Mumbai Metropolitan Region (MMR) continued to see resilient buyer activity despite supply contractions (Mumbai –9.7% QoQ, Navi Mumbai –10.7% QoQ), fueling significant price momentum. In the South, Bengaluru maintained its growth momentum with demand up +5.9% QoQ and prices rising +3.9% QoQ, while Chennai experienced a –5.4% QoQ dip in demand even as fresh launches lifted supply by +1.9% QoQ.
Sudhir Pai, CEO, Magicbricks, said, “The July–September 2025 quarter reinforced a fundamental market shift toward compact and mid-segment housing. 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 PropIndex Q3 2025 findings reaffirm that India’s residential market is entering a phase of measured growth, shaped by affordability, infrastructure expansion, and evolving buyer aspirations. As compact homes gain ground and under-construction projects attract premiums, the balance between demand and supply will remain crucial in sustaining momentum. Looking ahead, housing activity is expected to be driven less by speculative trends and more by pragmatic, end-user decisions, positioning real estate as a stable and enduring investment class.
Frequently Asked Questions
What is the PropIndex report?
The PropIndex report is a quarterly analysis by Magicbricks, India’s leading real estate platform, that provides insights into the trends and shifts in the country’s housing market.
Why is demand for 1-2 BHK units increasing?
Demand for 1-2 BHK units is increasing due to affordability constraints and a shift in buyer behavior towards more compact and mid-segment housing options.
Which cities saw the highest price appreciation?
Pune, Mumbai, and Greater Noida recorded the sharpest annual price appreciation, driven by resilient demand and limited new launches.
What role do infrastructure projects play in the housing market?
Large-scale infrastructure projects, such as the Dwarka Expressway and RRTS corridors, are boosting demand in regions like Delhi NCR by improving connectivity and infrastructure.
What is the future outlook for the Indian housing market?
The future outlook for the Indian housing market is positive, with a focus on affordability, infrastructure expansion, and evolving buyer aspirations. Housing activity is expected to be driven by pragmatic, end-user decisions, making real estate a stable and enduring investment class.
Related News Articles
Real Estate Investment Trusts in India: Recent Regulatory Updates
SEBI introduces new regulations for Small and Medium Real Estate Investment Trusts, revises pricing methodology for privately placed Infrastructure Investment Trusts, and amends SEBI (InvIT) Regulations, 2014.
Oberoi Realty Gains NCLT Approval for Nirmal Lifestyle Takeover in Mumbai
Oberoi Realty has received approval from the National Company Law Tribunal (NCLT) to acquire Nirmal Lifestyle, solidifying its position in Mumbai's competitive real estate market. The acquisition includes a 20,262.24 square meters plot adjacent to Oberoi'
Mid-sized Developers Thrive in India's Reviving Real Estate Market
The Indian real estate sector is witnessing a significant upturn, and mid-sized developers are seizing the opportunity. These firms are focusing on niche developments and innovative strategies to carve out a strong market presence.
Bajaj Housing Finance Shares Drop 6% as 12 Million Shares Hit Market After Lock-In Period
Bajaj Housing Finance shares experienced a significant dip of 6% as the three-month lock-in period for anchor investors ended, leading to a surge in shares available on the market.
Maharashtra RERA Freezes Bank Accounts of Non-Compliant Developers
Maharashtra Real Estate Regulatory Authority (MahaRERA) takes strict action against non-compliant developers by freezing their bank accounts. This move is aimed at ensuring transparency and accountability in the real estate sector.
NoBroker’s Ambitious Leap into Conversational AI SaaS with ConvoZen.AI
India’s first proptech unicorn, NoBroker, has ventured into the highly competitive Conversational AI Cloud market with its new platform, ConvoZen.AI. This strategic move leverages NoBroker’s extensive experience in customer interactions to deliver advance