Indian Housing Demand Cools 8.7% in Q4; Price Growth Slows
Overview
India's residential real estate market saw demand dip 8.7% in the October-December quarter, though supply grew 3.4%. Price appreciation slowed to its weakest pace in two years, influenced by festive spending and interest rate outlooks. Developers focused on mid-segment launches aligned with affordability.
Housing demand across major Indian cities softened by 8.7% quarter-on-quarter in the October-December period, according to Magicbricks PropIndex. This slowdown occurred even as housing supply increased by 3.4% during the same period, signalling a period of measured cooling in the residential real estate sector.
Residential prices saw a modest increase of 1.5% from the previous quarter and 16.9% year-on-year. However, this pace of price appreciation represents the slowest rate observed over the past two years. The moderation in buyer interest was attributed to typical festive season spending patterns and a cautious stance amid evolving interest rate expectations. Many homebuyers adopted a wait-and-watch approach.
Developers responded by increasing supply, particularly in areas like Greater Noida, Gurugram, Thane, and Noida. New project launches were increasingly geared towards the mid- and upper-mid market segments, reflecting a strategic alignment with end-user affordability.
Demand Cools Amid Festive Spending
Housing demand across major Indian cities experienced an 8.7% decline in the October-December quarter compared to the previous three months. This moderation coincided with the festive season and shifts in monetary policy, leading many potential buyers to adopt a more cautious, wait-and-watch strategy.
Price Growth Ebbs, Supply Recovers
While residential prices still managed a 1.5% quarter-on-quarter increase and a 16.9% year-on-year rise, the pace of appreciation has become the slowest in two years. Concurrently, housing supply saw a rebound, notably in Greater Noida, Gurugram, Thane, and Noida, with developers focusing on mid- and upper-mid segments aligned with affordability.
2026 Market Outlook
Market experts anticipate that 2026 will see its momentum influenced by clearer interest rate signals, effective infrastructure project execution, and the ongoing effort to match new housing supply with market affordability levels.
