ShutterstockGRI Barometer India 2025 - What is driving the cautious optimism in real estate?
Industry leaders share their perspective on the Indian property market and economic outlook
August 12, 2025Real Estate
Written by Isabella Toledo
The results of the latest GRI Barometer India 2025 paint a picture of cautious optimism in India’s real estate sector. While many industry leaders foresee brighter prospects for the economy and their own businesses, the outlook remains tempered by ongoing regulatory challenges, cost pressures, and global uncertainties.
Confidence with Caution
A clear majority of respondents expect the Indian economy to perform better over the coming year compared with the previous twelve months. This optimism is reflected in corporate behaviour, with most companies actively pursuing investment or expansion strategies, although a significant share are still taking a wait-and-see approach.
Company and Market Performance Expectations
Expectations for company-level results are strong, with most executives anticipating good or excellent performance over the next twelve months. Sentiment about the real estate market as a whole is slightly more restrained, with many predicting solid outcomes but fewer expecting standout results.
Sector Opportunities
Office space is viewed as the most promising segment, ahead of residential and plotted developments. Warehousing facilities and data centres also feature prominently, signalling continued appetite for sectors tied to both industrial activity and technological growth. The infrastructure, hospitality, and retail sectors are seen as more selective opportunities.
Regulatory Hurdles and Rising Costs
Approval processes and regulatory delays top the list of current market challenges, followed by escalating construction costs and financing constraints. On a broader level, global geopolitical tensions, rising input costs, and intensifying competition are influencing strategic decisions.
Monetary Policy and Inflation Expectations
Most industry leaders anticipate stability or only minor increases in interest rates by the end of the year. Inflation is also expected to move within a narrow band, with little expectation of sharp shifts in either direction.
Development is Staying on Track
Despite economic and political headwinds, most companies plan to maintain their originally scheduled project launches for the year. Only a small minority are scaling back volumes or altering their pipeline significantly, reflecting confidence in underlying demand fundamentals.
Labour and Workforce Trends
Hiring activity is expected to remain healthy, with many companies planning to grow their teams. However, concerns over the availability of skilled labour persist, with some reporting greater difficulty in recruitment compared to previous periods.
Metro Strength and Emerging Hotspots
Bangalore, Mumbai and Delhi-NCR continue to lead as the most attractive cities for real estate investment. Hyderabad, Pune and a range of tier-2 cities are also drawing strong interest, highlighting a balance between established markets and emerging destinations.
The GRI Barometer India Q2 2025 underscores a sector that is willing to grow but remains constrained by systemic inefficiencies.
For developers, accelerating approval processes could be transformative, reducing costs and unlocking stalled pipelines, while those with strategies that balance metro dominance with tier-2 city expansion stand to secure more durable returns.
The appeal of office and residential markets offers a clear path: align with India’s expanding role in global capability centres while meeting the housing demands of a rapidly urbanising population.
Policymakers, meanwhile, hold the levers to amplify this momentum by streamlining regulations and tackling skilled labour shortages head-on.
Across the industry, the current backdrop of stable interest rates and manageable inflation presents a valuable window for long-term planning - provided that geopolitical volatility and cost pressures are addressed with deliberate, proactive measures.
Click here to access the full GRI Barometer India 2025.
The results of the latest GRI Barometer India 2025 paint a picture of cautious optimism in India’s real estate sector. While many industry leaders foresee brighter prospects for the economy and their own businesses, the outlook remains tempered by ongoing regulatory challenges, cost pressures, and global uncertainties.
Confidence with Caution
A clear majority of respondents expect the Indian economy to perform better over the coming year compared with the previous twelve months. This optimism is reflected in corporate behaviour, with most companies actively pursuing investment or expansion strategies, although a significant share are still taking a wait-and-see approach.
Company and Market Performance Expectations
Expectations for company-level results are strong, with most executives anticipating good or excellent performance over the next twelve months. Sentiment about the real estate market as a whole is slightly more restrained, with many predicting solid outcomes but fewer expecting standout results.
Sector Opportunities
Office space is viewed as the most promising segment, ahead of residential and plotted developments. Warehousing facilities and data centres also feature prominently, signalling continued appetite for sectors tied to both industrial activity and technological growth. The infrastructure, hospitality, and retail sectors are seen as more selective opportunities.
Regulatory Hurdles and Rising Costs
Approval processes and regulatory delays top the list of current market challenges, followed by escalating construction costs and financing constraints. On a broader level, global geopolitical tensions, rising input costs, and intensifying competition are influencing strategic decisions.
Monetary Policy and Inflation Expectations
Most industry leaders anticipate stability or only minor increases in interest rates by the end of the year. Inflation is also expected to move within a narrow band, with little expectation of sharp shifts in either direction.
Development is Staying on Track
Despite economic and political headwinds, most companies plan to maintain their originally scheduled project launches for the year. Only a small minority are scaling back volumes or altering their pipeline significantly, reflecting confidence in underlying demand fundamentals.
Labour and Workforce Trends
Hiring activity is expected to remain healthy, with many companies planning to grow their teams. However, concerns over the availability of skilled labour persist, with some reporting greater difficulty in recruitment compared to previous periods.
Metro Strength and Emerging Hotspots
Bangalore, Mumbai and Delhi-NCR continue to lead as the most attractive cities for real estate investment. Hyderabad, Pune and a range of tier-2 cities are also drawing strong interest, highlighting a balance between established markets and emerging destinations.
The GRI Barometer India Q2 2025 underscores a sector that is willing to grow but remains constrained by systemic inefficiencies.
For developers, accelerating approval processes could be transformative, reducing costs and unlocking stalled pipelines, while those with strategies that balance metro dominance with tier-2 city expansion stand to secure more durable returns.
The appeal of office and residential markets offers a clear path: align with India’s expanding role in global capability centres while meeting the housing demands of a rapidly urbanising population.
Policymakers, meanwhile, hold the levers to amplify this momentum by streamlining regulations and tackling skilled labour shortages head-on.
Across the industry, the current backdrop of stable interest rates and manageable inflation presents a valuable window for long-term planning - provided that geopolitical volatility and cost pressures are addressed with deliberate, proactive measures.
Click here to access the full GRI Barometer India 2025.