India Housing Outperforms Globally as Price Growth Stays Strong

03 Feb 2026 CW Team

Residential sales across India’s top eight cities remained resilient in 2025, crossing 348,000 units, with H2 2025 marking the highest half-yearly volumes since 2013. Despite an increase in unsold inventory—largely due to a higher share of premium project launches—market fundamentals stayed balanced, with the quarters-to-sell ratio steady at 5.8 quarters.

Price appreciation was widespread across key cities. The National Capital Region led with a 19 per cent year-on-year increase, followed by Hyderabad at 13 per cent, Bengaluru at 12 per cent and Mumbai at 7 per cent. Knight Frank attributed this trend to sustained demand for mid-to-premium housing, aided by cumulative interest-rate cuts, stable inflation and rising household incomes.

A structural shift in buyer preferences continued through 2025, with homes priced above Rs 10 million accounting for nearly half of total residential sales. Developers responded by moderating new launches, focusing on execution quality and offering selective financing incentives rather than price corrections, thereby sustaining absorption levels.

Commenting on the outlook, Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India, said, “India’s housing market continues to stand apart in a global environment that remains uneven. The combination of strong economic growth, easing financial conditions and a decisive shift towards end-user-led demand has created a more mature and resilient residential cycle. As we move into 2026, we expect the market to be defined by stable absorption, selective price appreciation and disciplined supply, rather than speculative excess.”

Globally, housing market performance remained uneven. Emerging markets and select European countries such as Turkey, North Macedonia and Portugal led price growth, while parts of Northern Europe and East Asia continued to see declines. Looking ahead, Knight Frank expects a gradual and market-specific recovery as easing rates improve sentiment but inflation continues to weigh on real price gains.

“Nominal growth has edged higher again as central banks pivot towards cuts, but real gains are still hard-won. To see firmer growth into 2026, policymakers will need to maintain an easing while inflation continues to retreat,” said Liam Bailey, Global Head of Research, Knight Frank.

India’s residential housing market continues to outperform global peers, supported by robust end-user demand, improving affordability and a stable macroeconomic backdrop, according to Knight Frank’s Global House Price Index Q3 2025 and India Real Estate: Office and Residential Market – H2 2025. While global house prices recorded a modest annual growth of 2.4 per cent in Q3 2025 amid a broad shift towards monetary easing, India ranked among the top ten global markets with a strong 9.6% year-on-year rise in residential prices.Residential sales across India’s top eight cities remained resilient in 2025, crossing 348,000 units, with H2 2025 marking the highest half-yearly volumes since 2013. Despite an increase in unsold inventory—largely due to a higher share of premium project launches—market fundamentals stayed balanced, with the quarters-to-sell ratio steady at 5.8 quarters.Price appreciation was widespread across key cities. The National Capital Region led with a 19 per cent year-on-year increase, followed by Hyderabad at 13 per cent, Bengaluru at 12 per cent and Mumbai at 7 per cent. Knight Frank attributed this trend to sustained demand for mid-to-premium housing, aided by cumulative interest-rate cuts, stable inflation and rising household incomes.A structural shift in buyer preferences continued through 2025, with homes priced above Rs 10 million accounting for nearly half of total residential sales. Developers responded by moderating new launches, focusing on execution quality and offering selective financing incentives rather than price corrections, thereby sustaining absorption levels.Commenting on the outlook, Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India, said, “India’s housing market continues to stand apart in a global environment that remains uneven. The combination of strong economic growth, easing financial conditions and a decisive shift towards end-user-led demand has created a more mature and resilient residential cycle. As we move into 2026, we expect the market to be defined by stable absorption, selective price appreciation and disciplined supply, rather than speculative excess.”Globally, housing market performance remained uneven. Emerging markets and select European countries such as Turkey, North Macedonia and Portugal led price growth, while parts of Northern Europe and East Asia continued to see declines. Looking ahead, Knight Frank expects a gradual and market-specific recovery as easing rates improve sentiment but inflation continues to weigh on real price gains.“Nominal growth has edged higher again as central banks pivot towards cuts, but real gains are still hard-won. To see firmer growth into 2026, policymakers will need to maintain an easing while inflation continues to retreat,” said Liam Bailey, Global Head of Research, Knight Frank.

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