Pune Real Estate Market Struggles: Home Sales Drop 29% in 2025
Pune's real estate market has seen a significant decline in home sales, with a 29% drop in the first half of 2025 compared to the previous year. The affordability issue and economic uncertainties are key factors reshaping the market.
Real EstateHome SalesPuneInterest RatesProperty PricesReal Estate PuneJun 27, 2025
Bharat Agarwal, president of Naredco Pune, noted that despite the significant decline in sales, a revival is expected, especially in the commercial leasing market. "The office market in Pune is at a lifetime high, which only indicates the number of jobs going up. Hence, the second half of the year shall definitely see a sales recovery," he said.
The increase in apartment sizes and rising interest rates have contributed to the wait-and-watch approach adopted by many prospective buyers. Slower salary growth and ongoing geopolitical uncertainties have further exacerbated the situation, making people think twice before committing to a new home. According to industry insiders, this trend is not limited to Pune; other metro cities are also experiencing similar challenges, with the exception of Chennai, which saw an 11% increase in the last three months.
In the seven metros combined, new home sales fell to 96,285 units in Q2 of 2025, down from 1.2 lakh units in the previous year. Anuj Puri, Chairman of Anarock, explained, "The housing market was rocked by major military actions at home and abroad. The war-like situation has pushed homebuyers to put their plans on hold. Adding to the impact is the soaring property prices over the past two years."
However, there is some positive news. The Reserve Bank of India (RBI) has recently cut interest rates three times, bringing the policy rate to 5.5% from 6.5%. This move is being seen as a positive sign by the real estate sector. Rohit Gera, MD of Gera Developments, stated, "This move could be a catalyst for lower borrowing costs, translating into reduced EMIs and improved homebuyer sentiment. Hopefully, banks will actively and rapidly pass on the cut to homebuyers."
Several projects in the Pimpri Chinchwad Municipal Corporation (PCMC) and adjoining areas are stuck due to environmental clearances, forming 45% of the total home market supply in Pune district. This has led to a lack of quality options for buyers, according to Manish Jain, president of Pune Metro Credai. To address the cautious approach of buyers, developers in Pune have reduced the supply of new apartments and controlled inventory.
The addition of new homes in the city has declined at almost the same rate as buying, with developers adding 14,220 units in Q2 of 2025 against 18,920 units in the same period last year. This has helped stabilize prices. Pune developers saw a yearly decline in inventory to 80,240 units in Q2 of 2025 from 94,770 units a year ago. "At the same time, new launches have dropped. Since both demand and supply have seen a decline, prices shall remain stable," Naredco Pune president Agarwal said.
Aditi Deshpande, a Warje resident, shared her experience, "I have been looking for a bigger apartment between Erandwane and Warje for almost a year now. Prices have gone up by 35% since the Covid-19 pandemic, making it difficult to pay the EMIs even if we rent out our existing home."
Raviraj Burse, another city resident, is trying to buy a flat in Deccan and Shivajinagar areas. "We were expecting a price range of Rs3 crore, but prices have gone up by a couple of crores, making it unaffordable. The lack of space in the core city areas has also contributed to the rise in prices. The only option is redevelopment projects, but they are riddled with legal complexity and increase the waiting time," he added.
Yerwada resident Suraj Patidar noted, "Pune might be affordable for people moving from Bengaluru, but for others, buying a home in Pune now is out of reach. Another option is to buy a home in far-off areas, but it increases the commute time. I am trying to relocate from a rented flat to my own home, but I feel I have missed the chance by delaying the decision by five years."
Abhijit Patil, a resident of Chinchwad, emphasized the financial challenges, "Rents are increasing by 10% every year, and so are home prices. In comparison, salary increments are meagre. With the current economic instability, interest rates might increase again. Buying a home is a long-term debt, and buyers should be prepared to deal with fluctuations."
Despite the challenges, the real estate market in Pune is showing signs of resilience. The combination of lower interest rates, a strong commercial market, and a potential second-half recovery could help stabilize the market and attract more buyers in the coming months.
Frequently Asked Questions
What is the main reason for the 29% drop in home sales in Pune?
The main reasons for the 29% drop in home sales in Pune are the increase in apartment sizes, rising interest rates, slower salary growth, and ongoing geopolitical uncertainties, which have made buyers more cautious.
How have interest rate cuts by the RBI affected the real estate market in Pune?
The recent interest rate cuts by the RBI are seen as a positive sign by the real estate sector. They could lead to lower borrowing costs, reduced EMIs, and improved homebuyer sentiment, potentially boosting the market.
What is the current state of the commercial leasing market in Pune?
The commercial leasing market in Pune is at a lifetime high, indicating an increase in the number of jobs. This is expected to contribute to a sales recovery in the second half of the year.
Why are developers in Pune reducing the supply of new apartments?
Developers in Pune are reducing the supply of new apartments and controlling inventory to address the cautious approach of buyers. This has helped stabilize prices in the market.
What are some of the challenges faced by homebuyers in Pune?
Homebuyers in Pune are facing challenges such as rising property prices, higher EMIs, slower salary growth, and limited quality options due to stalled projects in key areas.
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