India’s real estate sector continued to show resilience in the July–September quarter of 2025, with eight major housing markets witnessing a nominal one per cent increase in sales, as per Knight Frank India.
According to the India Real Estate Market Update for Q3 2025, by Knight Frank India the residential market remained stable, with 87,603 housing units sold during the quarter — up 1 per cent from a year ago. Mumbai led the pack with 24,706 units sold, while Chennai recorded the fastest growth at 12 per cent, marking its best performance since the COVID-19 pandemic. Sales declined only in Pune, which registered an 8 per cent fall.
Lower inflation, rate cuts lift homebuyer sentiment
The report said steady housing demand came amid lower inflation and interest rates, which supported homebuyer sentiment. India’s inflation eased to 2.07 per cent in August 2025 from 3.65 per cent a year ago, while the repo rate was a full percentage point (100 bps) lower than at the end of 2024.
Knight Frank India said sales data from the ongoing festive quarter will provide a clearer picture of market trends. The consultant added that strong economic growth and tax incentives in the Budget have helped sustain demand, while the impact of improved consumer confidence following the GST rate rationalisation on September 22 is yet to be seen.
Knight Frank sees residential market stabilising after prolonged upcycle
“India’s residential market in Q3 (July-September 2025) has demonstrated an impressive ability to sustain momentum, and the market is now in its fifth year of an upcycle. Consequently, the Y-o-Y (year-on-year) growth rate is beginning to rationalise, and we may be entering a prolonged plateau phase,” Knight Frank India CMD Shishir Baijal said.
Nevertheless, during the first nine months of this year, the sales declined one per cent annually to 2,57,804 units across eight major cities compared with the same period last year. These eight cities are Delhi-NCR, Mumbai Metropolitan Region (MMR), Pune, Chennai, Hyderabad, Bengaluru, Kolkata and Ahmedabad.
No signs of demand slowdown in housing market yet: Knight Frank
“We are not seeing any signs of demand slowdown as of yet,” said Gulam Zia, Senior Executive Director, Research, Advisory, Infrastructure, and Valuation, Knight Frank India.
As per a report by PTI, he said the sales have risen marginally during the latest September quarter, despite concerns in markets about the possibility of a demand slowdown.
Developers should focus on affordable homes: Knight Frank
Zia, however, pointed out that there have been some “cracks” in demand for luxury and ultra-luxury homes. He advised developers to consider the development of affordable homes, as there is a limitation of growth potential in the luxury housing segment.