Mumbai Real Estate Surges: Housing Sales Climb, Office Leasing Hits Decade High
Overview
Mumbai solidified its position as India's top real estate market in 2025. Knight Frank reports office leasing reached the second-highest volume in over a decade, with Global Capability Centres driving demand. Residential sales saw a modest uptick, and prices climbed, fueled by infrastructure improvements and a shift towards higher ticket sizes.
Mumbai's Real Estate Market Dominates 2025
Mumbai closed 2025 as India's premier residential property market and recorded its second-highest office leasing volume in more than a decade. Despite a 5% year-on-year dip, the city absorbed 9.8 million square feet (sq ft) of office space. The second half of the year saw 4.3 million sq ft leased, propelled by large deals in suburban areas.
Global Capability Centres Fuel Demand
Global Capability Centres (GCCs) emerged as the primary demand driver, dramatically increasing their share of office leasing to 27% in the latter half of 2025, up from 9% in the previous year. This surge was predominantly led by firms in the BFSI, technology, and engineering sectors. While India-facing occupiers remained the largest segment at 40%, their share significantly decreased from 72% recorded a year earlier. Third-party IT and ITeS firms also expanded their presence, accounting for 20% of leasing, particularly in cost-effective hubs like Andheri East and Thane.
Rental Values and Vacancy Stable
Average transacted office rents increased by 6% year-on-year to ₹125 per sq ft per month. This rise was supported by demand for quality spaces and limited new supply. Vacancy levels held steady at 18.3%, even as new construction completions fell by 12% annually.
Residential Market Shows Steady Growth
On the residential front, Mumbai recorded 97,188 home sales in 2025, a marginal 1% increase over the previous year. The second half saw a 3% rise in sales, reaching 50,153 units. Average residential prices climbed 7% annually to ₹8,856 per sq ft, reflecting consistent end-user demand and constrained supply.
Demand Shifts to Higher Ticket Sizes
A notable trend was the shift away from affordable housing, with demand increasingly concentrated in the ₹2-5 crore price bracket. Enhanced infrastructure, including the operationalisation of Metro Line 3 and the Mumbai Trans Harbour Link, continued to bolster demand in peripheral and suburban markets.
