India's Real Estate Sector Surges in 2025 with Record Deals and Unprecedented Affordability
India’s real estate sector closed 2025 on a firm footing, with capital market activity matching last year’s pace and housing affordability at its best level in three decades, according to a report by Equirus Capital.
Between April and December FY26, the sector recorded 11 capital market deals, raising ₹17,867 crore — already equalling the number of deals seen in FY25. Equirus said both deal count and fund mobilisation could surpass the highest levels seen over the past six years if momentum sustains into the March quarter.
Since FY18, real estate has raised ₹72,331 crore from capital markets, with real estate investment trusts accounting for the largest share at ₹31,241 crore. Large-cap developers raised ₹20,437 crore, followed by mid-caps at ₹12,496 crore and small-cap firms at ₹8,156 crore.
The report highlighted a sharp improvement in housing affordability across India, driven by steady home loan rates, stable rental yields, and rising incomes. The property price-to-income ratio has declined to 3.3 in 2024 from 22 in 1995, marking the best affordability levels in nearly 30 years. Equirus expects the gap between home loan rates and rental yields to narrow to below 500 basis points in FY26.
Residential absorption has continued to match or exceed supply across top cities, supporting launch momentum and keeping inventories in check. Commenting on the outlook, Robin Mangla, President at M3M India, said 2025 reflected consolidation backed by macro stability and rising homeownership demand.
Looking ahead to 2026, he said large infrastructure projects, including the Noida International Airport, could further support residential demand and valuations, particularly in NCR markets such as Noida.
The robust performance of the real estate sector in 2025 is a testament to the resilience of the Indian economy and the growing confidence among developers and investors. As affordability continues to improve and infrastructure projects gain momentum, the sector is poised for sustained growth in the coming years.
