India’s residential property landscape showed a pronounced tilt toward premium housing in 2025, as apartments priced above Rs 1 crore expanded their market share to 63%, up from 53% in 2024. This shift reflects buyers’ growing preference for value-driven and lifestyle-oriented properties even as overall unit sales softened, industry analysts noted.
The premiumisation trend was particularly strong in the Rs 1.5-3 crore segment, which recorded a 19% increase in demand over the previous year. While overall volumes declined in several cities, select urban markets demonstrated remarkable resilience. Chennai led this momentum with a 31% year-on-year rise in annual sales, reaching nearly 14,837 units, driven by robust employment and rising purchasing power in the city. Bengaluru, Mumbai, and Pune collectively accounted for over 50,000 units each, together representing 63% of total residential sales. These cities maintained stability during moderation phases, supported by established infrastructure, lifestyle amenities, and high-quality real estate offerings. Analysts highlighted that market fundamentals, including proximity to commercial hubs and connectivity, continue to underpin sustained demand for premium properties. Quarterly trends also revealed a mixed performance. Chennai and Delhi NCR sustained sales growth in Q4 2025, with Chennai posting an exceptional 86% year-on-year surge.
Meanwhile, home prices across India’s seven largest metropolitan markets continued to appreciate, rising between 6% and 13% over the year. Chennai, Bengaluru, and Delhi NCR each led with 13% growth in capital values, followed closely by Kolkata at 12%, underscoring the continuing strength of high-end housing. Developers’ strategic responses to market conditions contributed to this trend. A sizeable proportion of new launches approximately 23% of annual sales fell within premium segments, reflecting selective supply management. Industry experts noted that builders prioritised higher-margin projects while moderating mid-range launches based on micro-market dynamics and end-user demand patterns. This disciplined approach, coupled with controlled inventory, appears to be sustaining pricing power for developers in the premium space. Urban planners suggest that this shift has broader implications for city development and housing affordability. Concentrated premium demand can drive improvements in infrastructure, green spaces, and lifestyle amenities, but may also accentuate disparities for mid-income buyers. Analysts emphasise that balanced development strategies, incorporating both mass and high-end housing, are essential to maintain inclusive urban growth while supporting market efficiency.
Looking ahead, India’s residential market is expected to remain robust, with premium housing segments continuing to expand in value and share. While overall sales volumes may fluctuate, strong buyer interest in quality, well-located, and amenity-rich homes is likely to underpin stable growth, encouraging developers to focus on long-term urban livability alongside economic returns.
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