Real Estate Stocks Slump Amid Demand Sluggishness Concerns
Mumbai: Real estate stocks experienced a decline on Wednesday, extending their losses into the third session, as concerns over slowing demand led investors to take profits.
Real EstateStocksDemandNiftyProfittakingReal Estate MumbaiSep 25, 2025
Eight of the 10 stocks in the index fell on Wednesday. Godrej Properties slid 4%, while DLF and Oberoi Realty fell 3.5% and 2.8%, respectively. Lodha Developers and Phoenix Mills each lost more than 2%.
"Realty stocks are seeing some profit-taking after the runaway rally last year, as the demand for real estate has turned sluggish while the supply remains strong," said Dharmesh Kant, head of research at Cholamandalam Securities. He added that further declines of 5-7% cannot be ruled out. In the premium segment, new launches have been limited after the euphoric demand last year, while mid-tier real estate players have also seen muted business.
The Nifty Realty index has risen 325% over five years, compared with the 127% gain in the benchmark Nifty. About 35% of those gains came in 2024, when the Nifty rose 8.8%. So far in 2025, the index is down 14.4% against the 5.5% advance in the benchmark.
"Now when the broader markets are witnessing a pullback, the selling pressure in these stocks intensified due to unwinding of positions," said Ruchit Jain, head of technical research at Motilal Oswal Financial Services.
In the past month, the realty index has lost 2.8%, compared with a 0.4% rise in the Nifty.
"While some realty stocks did see price up moves, the volumes were subdued," Jain said. "However, the higher volumes during the declines indicate bearish sentiment."
"The verdict on the tariffs is expected by November-December, until then the volatility is expected to sustain," Kant said.
Frequently Asked Questions
Why are real estate stocks declining?
Real estate stocks are declining due to concerns over slowing demand, which has led investors to take profits after a strong rally last year.
What is the performance of the Nifty Realty index compared to the benchmark Nifty?
The Nifty Realty index has risen 325% over five years, compared to a 127% gain in the benchmark Nifty. However, in 2025, the realty index is down 14.4% while the Nifty has advanced 5.5%.
Which real estate companies have seen significant declines?
Godrej Properties slid 4%, DLF and Oberoi Realty fell 3.5% and 2.8% respectively, while Lodha Developers and Phoenix Mills each lost more than 2%.
What factors are affecting the demand for real estate?
The demand for real estate has turned sluggish, with new launches in the premium segment limited after last year's high demand, and mid-tier players seeing muted business.
What is the outlook for real estate stocks in the near future?
Further declines of 5-7% in real estate stocks cannot be ruled out, and volatility is expected to sustain until the verdict on tariffs, expected by November-December.
Related News Articles
Luxury Redefined: Ceratec Group Unveils Presidential Towers in Ravet, Pune
Discover the epitome of luxury living with Ceratec Group's latest project, Presidential Towers, offering 2 and 3 BHK homes in the heart of Ravet, Pune.
Rexas Finance (RXS) Price Forecast: Will It Be a Top Performer in 2025?
Rexas Finance (RXS) is making waves in the financial sector with its innovative approach to asset management. From real estate to art and goods, RXS offers a user-friendly interface for seamless asset trading and management. This article explores the pote
Government Hikes: Ordinary Citizens Bear the Brunt in Karnataka
With a series of tax and price hikes, the Karnataka government is placing a significant financial burden on ordinary citizens. From fuel and liquor to milk and water, the costs are rising, while the government contemplates more increases in property tax,
Port Sector Development: Key Focus in My Third Term, Vadhavan Port Underway
In a significant push towards infrastructure development, the port sector has emerged as a key focus area in my third term. The work on the Vadhavan port has already begun, marking a crucial milestone in this initiative.
Women Lead the Charge in India's Real Estate Market
Women investors are increasingly making their mark in both residential and commercial real estate in India, shattering traditional gender barriers and driving market growth.
Housing Loans Reach ₹33.53 Trillion in Q2FY25: NHB
The National Housing Bank (NHB) reports that housing loans outstanding have reached ₹33.53 trillion in the second quarter of FY25, signaling a promising outlook for the housing sector.