+
India’s Residential Sales to Dip Slightly in FY26
Real Estate

India’s Residential Sales to Dip Slightly in FY26

Residential sales in India’s seven major cities are projected to decline by up to 3 per cent year-on-year in FY26 to 620–640 million square feet (msf), amid a moderation in sales velocity, according to ratings agency Icra.
In FY25, sales stood at 643 msf, down 8 per cent YoY, following a sharp contraction in new launches and moderated demand in the affordable and mid-income segments. This slowdown came after the sector posted a robust compound annual growth rate of 26 per cent in area sales between FY22 and FY24.
Icra noted: “Having seen a strong upcycle, the sector entered an equilibrium phase in FY25, which is expected to continue into FY26.”
Affordability remains under pressure, with average selling prices (ASPs) rising over 10 per cent annually between FY23 and FY25. ASPs are expected to increase a further 6–8 per cent in FY26, driven by higher luxury sales, limited inventory, and increased pricing power among large listed developers. The years-to-sell (YTS) ratio is estimated to remain healthy at 1.0–1.1x by March 2026.
On the supply side, new launches are projected to grow 4–7 per cent in FY26 to 630–650 msf, recovering from a 14 per cent decline last year. The growth will be supported by spillover projects and comfortable unsold inventory. Anupama Reddy, Co-group Head and Vice President – Corporate Ratings at Icra, said: “The calibrated launches by developers helped maintain healthy inventory levels despite moderation in sales.”
Industry consolidation is accelerating, with listed developers’ share of total sales value rising to 20 per cent in FY25 from 13.1 per cent in FY20. Reddy added that these players are expected to continue outperforming the broader market, supported by lower leverage, strong collections, and robust cash flows.
Debt levels may rise slightly in FY26 to support construction and expansion, but leverage is expected to remain manageable, aided by steady receivables and progress in ongoing projects, Icra noted. 

Residential sales in India’s seven major cities are projected to decline by up to 3 per cent year-on-year in FY26 to 620–640 million square feet (msf), amid a moderation in sales velocity, according to ratings agency Icra.In FY25, sales stood at 643 msf, down 8 per cent YoY, following a sharp contraction in new launches and moderated demand in the affordable and mid-income segments. This slowdown came after the sector posted a robust compound annual growth rate of 26 per cent in area sales between FY22 and FY24.Icra noted: “Having seen a strong upcycle, the sector entered an equilibrium phase in FY25, which is expected to continue into FY26.”Affordability remains under pressure, with average selling prices (ASPs) rising over 10 per cent annually between FY23 and FY25. ASPs are expected to increase a further 6–8 per cent in FY26, driven by higher luxury sales, limited inventory, and increased pricing power among large listed developers. The years-to-sell (YTS) ratio is estimated to remain healthy at 1.0–1.1x by March 2026.On the supply side, new launches are projected to grow 4–7 per cent in FY26 to 630–650 msf, recovering from a 14 per cent decline last year. The growth will be supported by spillover projects and comfortable unsold inventory. Anupama Reddy, Co-group Head and Vice President – Corporate Ratings at Icra, said: “The calibrated launches by developers helped maintain healthy inventory levels despite moderation in sales.”Industry consolidation is accelerating, with listed developers’ share of total sales value rising to 20 per cent in FY25 from 13.1 per cent in FY20. Reddy added that these players are expected to continue outperforming the broader market, supported by lower leverage, strong collections, and robust cash flows.Debt levels may rise slightly in FY26 to support construction and expansion, but leverage is expected to remain manageable, aided by steady receivables and progress in ongoing projects, Icra noted. 

Related Stories

Gold Stories

Next Story
Real Estate

Peninsula Land launches 19 luxury villas in Pune

Pune’s residential landscape is witnessing a shift as premium homebuyers increasingly seek larger spaces, privacy and independent living options beyond high-rise apartments. Addressing this demand, Peninsula Land Limited, part of the Ashok Piramal Group, has launched AshokVillas, an exclusive collection of 19 premium furnished villas in Gahunje, Pune.The development combines the independence of a standalone home with the convenience and security of a managed residential community. Designed around low-density horizontal living, AshokVillas offers residents private spaces while providing acces..

Next Story
Infrastructure Urban

MyBranch Expands South India Network with 16 Workspace Centres

MyBranch has expanded its South India presence with a 50,000 sq ft flexible workspace network comprising 16 centres across 14 cities in Andhra Pradesh, Karnataka, Tamil Nadu and Telangana.The expansion reflects growing demand for flexible office infrastructure as businesses establish regional teams, satellite offices and operations beyond traditional metropolitan markets. MyBranch’s network spans Bengaluru, Coimbatore, Guntur, Hanamkonda, Hubballi, Hyderabad, Madurai, Mangaluru, Rajahmundry, Salem, Tirupati, Vellore, Vijayawada and Visakhapatnam, with a large office space in Chennai also und..

Next Story
Building Material

Walplast Launches Moisture-Resistant Gypsum Plaster Solutions

Walplast Products Pvt. Ltd. has expanded its HomeSure GypEx portfolio with the launch of GypEx MoistShield and GypEx Gold, two gypsum plaster solutions designed to address moisture-prone applications and improve plastering efficiency.The new products have been developed in response to the growing demand for faster construction processes, improved material performance and consistent surface quality. The solutions aim to simplify interior plastering while addressing specific application requirements across construction environments.“Through HomeSure GypEx MoistShield and GypEx Gold, we are exp..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code