R. Suryamurthy
India’s top seven cities experienced a notable 20% year-on-year decline in housing sales during the second quarter of 2025, according to the latest data from ANAROCK Research. Geopolitical tensions, including “Operation Sindoor” and the Iran-Israel war, coupled with persistently rising property prices, are cited as primary factors dampening buyer sentiment.
Despite the significant annual dip, the market showed signs of a quarterly rebound, with sales increasing by 3% compared to Q1 2025. A total of approximately 96,285 units were sold across the top cities in Q2 2025, a modest rise from 93,280 units in the previous quarter, though considerably less than the over 1.20 lakh units sold in Q2 2024.
Market Highlights
The Mumbai Metropolitan Region (MMR) and Pune together dominated sales, accounting for a combined 48% of total units sold in Q2 2025, with approximately 31,275 and 15,410 units, respectively.
Chennai stood out as the sole city to record a yearly sales increase, with an 11% rise to approximately 5,660 units sold in Q2 2025, up from 5,100 units in Q2 2024. Quarter-on-quarter, Chennai witnessed a substantial 40% jump in sales.
Supply-Side Adjustments
Developers responded to the market conditions by throttling back new supply, which saw a 16% year-on-year decline. Approximately 98,625 new units were launched in Q2 2025, down from 1.17 lakh units in Q2 2024. On a quarterly basis, new launches saw a marginal 1% decline.
MMR and NCR led new supply additions, together contributing 48% of the total. Notably, NCR experienced a significant 69% quarter-on-quarter surge in new supply and a 10% yearly increase, indicating renewed developer confidence in the region.
The luxury and ultra-luxury segments (priced over INR 1.5 crore) continued to drive new supply, accounting for 46% of all new launches. The mid-segment (INR 40 lakh – INR 80 lakh) and premium segment (INR 80 lakh – INR 1.5 crore) each held a 21% share, while affordable housing comprised just 12% of the new supply.
Expert Outlook
Anuj Puri, Chairman – ANAROCK Group, commented on the fluctuating market, stating, “The second quarter of 2025 was a rollercoaster for the Indian housing market, rocked by major military actions at home and abroad. The war-like climate pushed homebuyers into wait-and-watch mode, compounding the impact of soaring property prices over the past two years.”
However, Puri expressed optimism for the future. “Now, with domestic tensions easing and the RBI’s repo rate cut injecting fresh optimism, buyer sentiment is rebounding,” he added. “Despite a 20% year-on-year dip in sales across the top 7 cities, a 3% uptick this quarter signals renewed momentum. With home loan rates softening and developers largely holding prices steady, the stage is set for a potential upswing in housing sales in the coming quarters.”
Property Prices and Unsold Inventory
Average property prices in the top cities recorded an 11% cumulative annual rise, but only a 1% quarterly increase. NCR witnessed the highest annual price jump at 27%, followed by Bengaluru (12%) and Hyderabad (11%).
Unsold inventory across the top seven cities saw a marginal quarterly increase to approximately 5.62 lakh units by the end of Q2 2025. Annually, however, unsold inventory decreased by 3%, with Pune recording the highest yearly decline of 15%.
The coming quarters will reveal whether the easing geopolitical tensions and softening home loan rates will indeed translate into sustained growth for India’s housing market.
(R. Suryamurthy is a senior economic journalist based in Delhi.)
