India's Real Estate Sector Raises Rs 17,867 Crore via Capital Markets in FY26 YTD

India’s real estate sector continues to demonstrate strong momentum, with 11 capital market deals raising Rs 17,867 crore during April–December FY26, according to a press note released by Equirus Capital.

The number of deals completed in the first nine months of FY26 has already matched the total deals seen in FY25, and both deal count and fundraising are likely to surpass previous highs, potentially making FY26 the strongest year for real estate capital markets activity in the past six years.

The deals include IPOs, QIPs, REITs, and rights issues, highlighting sustained investor appetite for the sector. Since FY18, the real estate industry has collectively raised Rs 72,331 crore, with REITs emerging as the largest beneficiaries, accounting for Rs 31,241 crore of total fundraising.

Large-cap real estate companies followed with Rs 20,437 crore, while mid-cap and small-cap players raised Rs 12,496 crore and Rs 8,156 crore, respectively.

Housing affordability in India is currently the best it has been in nearly 30 years, driven by steady home loan rates, stable rental yields, and rising incomes. The property price-to-annual income ratio, which stood at 22 in 1995, has declined sharply over the decades to 3.3 in 2024, reflecting improved affordability across urban India.

Home loan rates and rental yields have largely remained stable since FY21, providing relief to homebuyers. Going forward, the gap between home loan rates and rental yields is expected to narrow to below 500 basis points in FY26, further supporting housing demand.

Supported by changing lifestyles, rising aspirations, income growth, and favourable financing conditions, real estate emerged as the most preferred asset class in H1 2025, the report noted. The sector’s upcycle is expected to continue in the near term, backed by strong economic growth and consumption trends.

Residential real estate across India has seen absorption levels match or exceed new supply over the last few years, indicating healthy demand and controlled inventory levels. The top seven cities witnessed robust sales momentum, supported by a steady pipeline of new launches during calendar year 2024. This balance between supply and absorption is helping sustain pricing power and developer confidence across key markets.

Equirus Capital believes the sector’s fundamentals remain strong, supported by affordability, institutional capital inflows, and sustained end-user demand. With REITs, listed developers, and capital markets playing a growing role in sectoral funding, Indian real estate appears well-positioned to sustain its growth trajectory in the coming years.