The Indian housing market is facing significant challenges as recent data reveals a notable decline in both sales and new supply. According to a report from PropEquity, a leading data analytics company, housing sales in the first quarter of 2025 plummeted by 23%, while new supply experienced a staggering drop of 34%. This downturn is evident across the country’s major cities, with only Bengaluru and Delhi-NCR showing any resilience.
Decline in Housing Sales Across Major Cities
During the January to March 2025 period, total housing sales reached 105,791 units, a stark contrast to 136,702 units sold in the same quarter of the previous year. The report highlights that all but two cities—Bengaluru and Delhi-NCR—saw a decrease in sales figures.
- Bengaluru and Delhi-NCR buck the trend
- Other cities face significant declines
New Supply Hits Record Lows
The report indicates that the total housing supply plummeted to 80,774 units in the first quarter of 2025, down from 122,365 units a year earlier. This marks three consecutive quarters where new launches have failed to exceed the 100,000-unit mark. In a concerning trend, all major cities except for Bengaluru reported a fall in new housing supply.
- Bengaluru saw a 17% increase in new units, totaling 20,227 units
- Other cities like Kolkata faced a dramatic 62% drop in supply
Expert Insights on Market Trends
Samir Jasuja, the Founder and CEO of PropEquity, notes that the housing market is undergoing a necessary correction after experiencing record supply in 2021, 2022, and 2023. This adjustment is impacting sales, which are declining due to rising home prices and investor caution amid geopolitical tensions and weaknesses in the Indian economy.
He emphasizes that despite the downturn, demand remains robust. The absorption-to-supply ratio is strong, showing 131% in Q1 2025, compared to 132% in the previous quarter.
- Traditional markets like Hyderabad, Pune, and Thane continue to struggle, showing a cumulative decline of 28,227 units compared to the prior year
- Their share of total launches has dwindled from 29% to just 3% in Q1 2025
Key Takeaways
- Bengaluru stands out with a significant increase in housing supply, constituting 25% of total launches.
- Other major cities like Mumbai, Thane, and Pune recorded substantial supply drops of 50% and more.
- The mixed performance across cities indicates potential opportunities for targeted investment, particularly in resilient markets.
In summary, the housing market’s current state presents both challenges and opportunities. Investors and buyers should stay informed and consider the regional dynamics that are shaping this evolving landscape. For those looking to navigate these changes, understanding local market conditions is essential.
