Ashok Ambade, a property broker in Thane near Mumbai, says he has seen a 10-20% drop in buying enquiries in the last six months. “There are very few buyers now,” Ambade, who has been in the business for 20 years now, adds. Vineet Matlani, another broker, pegs the decline in enquiries at an even higher 30-35%. The luxury segment where apartments are priced over Rs 5 crore have been impacted the most, he says, adding that developers are slowly coming out with offers such as 30:70 or 20:80 and so on to make sure that the phone calls don’t stop after the initial enquiries.
Most agree. Home sales were driven by the demand to upgrade, which, in turn, was partly driven by the wealth effect created by the stock market. But the markets have been declining, with the Sensex losing 14% since its peak in September last year. HSBC Securities said in a report last month that while the National Capital Region (NCR) continues to do better than the others, Hyderabad’s deterioration is evident with the drop in the number of units and value sold, and four consecutive quarters of declining project launches.
Even Bengaluru is slowing, with two-quarters of decline in units sold despite launch growth. The average apartment size is peaking in some cities. Real estate researchers such as Pankaj Kapoor, managing director at Liases Foras, a real estate ratings and research firm, agree with local brokers. “After 15-16 quarters, we saw a 1.5% decline last quarter (Q3FY25) in sales on a sequential basis,” Kapoor said, adding that the sales would plateau or decline in the coming months. Earlier, people were booking profits in stock markets and investing in properties which is not the trend now, he said, adding that the sharp run-up in prices has also impacted the property market.
However, Kapoor said the mid-income segment (priced between `75 lakh and `2.5 crore)is growing slowly. “There may be better growth in this segment as the government has given concessions on income tax for people earning up to `12 lakh,” he said.Anuranjan Mohnot , MD and CEO at Lumos Alternate Investment Advisors, said that stock market investors are holding back their property purchases in cities such as Ahmedabad due to losses in the stock market. Prashant Thakur, regional director and head of research and advisory at Anarock, said that launches have happened in all cities but sales are not as exuberant as last year. Huge layoffs by some companies have also made prospective buyers adopt a wait and watch approach, Thakur said.
Purchase cycles are elongated, said Amit Bagri, CEO at Kotak Mahindra Investments. “Earlier, they had FOMO (fear of missing out). Now, buyers visit or enquire three to four times before buying,” he said.
Top property developers, however, have a different take. Amit Kumar Sinha, managing director and CEO at Mahindra Lifespace Developers, said the overall real estate market continues to show buoyancy, with absorption growth at around 6% year-over-year. “While stock market movements can temporarily influence investor sentiments, our customer base is primarily composed of end-users who make long-term, well-planned homebuying decisions,” Sinha said. In the nine months in FY25, the company saw a growth of 41% in pre-sales.
Rajat Rastogi, CEO-West at Puravankara, said the 9-10% salary hikes are helping the demand and downward interest rate cycles will also push the sales. “If stock markets go down 7-8% from here, there will be some impact on demand,” he added. Mumbai property registrations fell 4% in February on a yearly basis to 11,541, according to Knight Frank India data. Property prices had risen an average of 21% in 2024 on a yearly basis, according to Anarock and around 10-30% between 2021 to 2023.