Indian Residential Market Update: Resilient Pricing, Regional Shifts, and Alternative Assets

Residential Market Performance

The Indian residential real estate market recorded a mixed trajectory in Q1 FY27 (Q2 2026), characterised by price-led revenue growth alongside moderating transaction volumes. 

Total residential sales value across the nation expanded by 9% year-on-year, supported by an average realisation increase to INR 9,629 per square foot, representing a 6% annual gain despite a 2% sequential decline. 

Data from Kotak Institutional Equities indicates nationwide sales reached 247 million square feet, reflecting a 3% year-on-year increase but a 3% quarter-on-quarter drop, with total FY26 residential sales value projected to touch INR 6.65 lakh crore.

In contrast, PropTiger's assessment of the top eight metropolitan markets showed physical unit sales declining 6.1% year-on-year to 91,729 units. 

Broader half-year indicators remain steady, with Knight Frank reporting H1 2026 sales of 171,471 units (up 1% year-on-year, with properties priced above INR 1 crore accounting for 54% of sales) and JLL recording H1 2026 sales of 1.38 lakh units against 1.68 lakh new unit launches.

Official property registration data from the Reserve Bank of India (RBI) across 18 major cities recorded annual house price growth moderating to 3.6% in Q1 FY27 (matching Q1 FY26 rates), down from 4.5% in Q4 FY26. 

On a sequential basis, the All-India House Price Index increased by 1.1% to reach 117.5. Primary sales values across the top eight urban centres averaged INR 10,153 per square foot according to PropTiger, marking the second consecutive quarter above the INR 10,000 threshold.

Listed real estate developers experienced significant pre-sales contraction during the quarter. Total sales bookings for 28 major listed firms fell 21% year-on-year to nearly INR 40,000 crore, down from INR 50,900 crore in Q1 FY26. 

Despite the aggregate decline, 19 of the 28 listed firms recorded positive pre-sales growth. Godrej Properties led overall developer bookings at INR 8,651 crore (up from INR 7,082 crore), followed by Prestige Estates Projects at INR 6,579.3 crore, Lodha Developers at INR 4,630 crore, Sobha Ltd at INR 3,656 crore, and Signature Global at INR 1,970 crore. 

Prominent gains were also posted by Max Estates (INR 1,093 crore) and Mahindra Lifespace (INR 925 crore). 

Although PropTiger noted a 6% increase in top-eight city unit launches, overall new project launches fell 14% year-on-year to 242 million square feet nationally, leaving unsold residential inventory at 1.80 billion square feet, or roughly 1.9 years of trailing 12-month sales.

Regional Variations and Urban Planning

Performance diverged sharply across primary metropolitan markets. According to Kotak, the Mumbai Metropolitan Region (MMR) led spatial absorption at 41.50 million square feet (up 16% year-on-year), while PropTiger recorded 24,112 units sold in MMR at an average price of INR 15,422 per square foot (up 20.4% year-on-year). 

Bangalore generated 30.70 million square feet in sales (up 20% year-on-year per Kotak) driven by technology sector expansion, global capability centres, and infrastructure delivery, though PropTiger recorded a 9.2% decline in physical unit sales to 14,186 units alongside a 26% price surge to INR 9,931 per square foot. 

Hyderabad recorded sales of 34.30 million square feet (up 14% year-on-year per Kotak), supported by 55.5 million square feet of fresh supply.

Conversely, Delhi-NCR saw residential sales fall 27% year-on-year to 23.5 million square feet, with PropTiger noting a 7% unit sales decline. Pune and Ahmedabad posted physical unit drops of 20.8% (12,642 units) and 20.2% (7,541 units) respectively. 

Bucking the downward volume trend, Chennai registered a 36% unit sales surge (7,183 units), while Hyderabad unit sales grew 15% (13,196 units). RBI data identified Chandigarh, Lucknow, and Thiruvananthapuram as the primary drivers of sequential price growth.

Urban planning initiatives are shifting to accommodate long-term population growth and density requirements. 

The Ministry of Housing and Urban Affairs unveiled the Delhi Master Plan 2047, which envisions constructing 40 lakh affordable housing units. The framework includes 18 lakh units in Transit Oriented Development zones, 12 lakh units across 200 square kilometres of land pooling, and 7 lakh units enabled by reducing minimum group housing redevelopment thresholds from 40,000 to 3,000 square metres. 

The plan also regularises residential buildings across 1,511 unauthorised colonies, securing property ownership for 45 lakh residents. 

Across wider markets, sustainable features in residential developments now command price premiums of 6% to 10%, offsetting rising concerns over urban heat, drainage, and private infrastructure over-densification.

Luxury and Branded Residences

India's luxury housing market is expanding rapidly toward a projected valuation of USD 275.40 billion by 2035, with international hospitality and fashion brands partnering with domestic developers.

Branded residences command a 30% to 40% price premium over unbranded luxury offerings. Knight Frank projects global branded developments to grow from 611 projects today to 1,019 by 2030.

Key transactions demonstrate high demand in prime corridors. Smartworld Developers, Tribeca Developers, and The Trump Organisation generated INR 3,250 crore in launch-day allotments for Trump Residences Gurgaon, selling all 298 units across two 51-storey towers. Smartworld has also partnered with ELIE SAAB for a new development in Noida Sector 98. 

M3M India holds a branded portfolio covering 6.9 million square feet with partners including ELIE SAAB, Jacob & Co., and The Trump Organisation, representing over INR 20,000 crore in revenue potential. This includes an INR 3,500 crore commitment to ELIE SAAB projects such as The Billionaire's Block in Gurugram. 

Whiteland Corporation partnered with Marriott International to launch Westin Residences Gurugram on the Dwarka Expressway, while Dalcore launched North India's first YOO-branded project, The Falcon, in Sector 53 Gurugram.

Concurrently, second-home investments are transitioning from passive lifestyle retreats into income-generating assets. Buyers are evaluating short-term rental yields and professional property management alongside capital appreciation in destinations across Delhi-NCR, Goa, and hill stations.

Senior and Student Housing

Demographic transitions and institutional interest are accelerating growth across specialised residential asset classes. According to Colliers, India's senior living market is projected to expand from INR 30,000 crore to INR 1 lakh crore by 2030 (crossing INR 70,000 crore by 2028). 

Driven by an elderly population projected to reach 34 crore (21% of the national total) by 2050, organised senior facilities are expected to quadruple within four years. Investors have committed over INR 13,000 crore since 2025 to deliver 75,000 units. 

Kerala serves as the primary hub, holding 31% of national senior living centres across Ernakulam, Thrissur, Kottayam, Thiruvananthapuram, and Pathanamthitta, backed by 40 lakh non-resident Keralites, family structural shifts, and government schemes like Vayomithram and Sayamprabha. 

Developer focus is widening into tier-2/3 cities (Coimbatore, Puducherry, Dehradun, and Vadodara) and spiritual centres (Tirupati, Vrindavan, and Ayodhya), incorporating AI emergency monitoring and telemedicine.

In the student housing sector, Colliers and Whalesbook report a structural supply gap, with total demand estimated at 12 million beds against a current organised co-living inventory of roughly 300,000 beds. 

Organised beds are projected to reach 1 million by 2030, catering to a tertiary student population expected to exceed 70 million by 2035. 

Institutional operators - including Stanza Living, Your-Space, Union Living, Curated Living, Amber, Colive, Zolo Stays, and University Living - operate across major educational hubs with monthly rentals ranging from INR 15,000 to INR 60,000 (averaging INR 30,000 to INR 35,000). 

While predictable rental yields attract institutional capital, operators face high land acquisition costs, thin margins, and operational complexity.

Underpinning this broader market confidence, Naukri's H2 2026 Hiring Outlook survey of over 540 senior HR leaders reveals that real estate leads all national sectors in employment optimism, with 86% anticipating new job creation, placing it ahead of FMCG, IT/Tech, manufacturing, healthcare, and BFSI, with recruitment demand concentrated in business development, marketing, and IT roles.
 

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Sources:
From Second Homes to Income Assets - Ahmedabad Mirror
India's Premium Senior Living Sector - Colliers
India's Student Housing Market Opportunity - Colliers
India Residential Market H1 2026 - JLL
India Residential Market H1 2026 - Knight Frank
All-India Housing Market Report Q1 FY27 - Kotak Institutional Equities
Chennai Real Estate Market Sees 6% Rise in Property Prices - Live Chennai
Delhi Master Plan 2047 - Ministry of Housing and Urban Affairs
H2 2026 Hiring Outlook Survey - Naukri
Real Insight Residential Report Q2 2026 - PropTiger
All-India House Price Index Q1 FY27 - Reserve Bank of India
Global brands betting big on Indian developers - The Hindu BusinessLine
Housing sales hit a speed bump as listed developers' bookings fall 21% - The Times of India
India Homebuying: Evaluating Resale Vs. New Projects in 2026 - Whalesbook
India’s Student Housing Sector Faces 12 Million Bed Gap - Whalesbook
India's Urban Growth Shifts Focus Toward Private Real Estate - Whalesbook
Luxury Branded Residences Surge Across Indian Real Estate - Whalesbook