Indian Real Estate Sees Premium Shift as Overall Sales Fall 11% in 2025

India's residential market saw a major shift in 2025. Despite an 11% drop in total unit sales, the premium housing segment (Rs 1 crore+) grew by 6%. The total sales value climbed 11%, highlighting a trend towards higher-value properties.

Premium housing units priced at Rs 1 crore and above saw 6 per cent year-on-year (Y-O-Y) growth in unit sales during 2025, highlighting market premiumization trends despite an 11 per cent decline in the overall residential market. According to a press release by JLL, total residential sales fell to 270,323 units in 2025, yet the market demonstrated a clear shift toward higher price segments.

Market Premiumization Amidst Sales Decline

Apartments priced above Rs 1 crore increased their market share from 53 per cent in 2024 to 63 per cent in 2025, while the mass segment's share contracted from 47 per cent to 37 per cent. The surge in premium demand was most prominent in the Rs 1.5-3.0 crore category, which recorded a 19 per cent increase in sales compared to the previous year. Despite the drop in volume, the total sales value across India climbed by approximately 11 per cent Y-O-Y to around Rs 5,57,100 crore. This growth in value amid a decline in unit sales confirms a transition toward higher-value transactions as buyers prioritise quality projects.

"India's residential market experienced a premiumization shift in 2025, with properties above INR 1 crore growing 6% Y-o-Y while mass housing below INR 1 crore fell by 30% during the period. Despite an 11% drop in total pan India housing unit sales, total sales value climbed by around 11% Y-o-Y to around INR 5,57,100 crores, demonstrating buyers' preference for quality developments over price premiums. This healthy sales value performance amid sales unit decline confirms the market's successful transition toward higher-value transactions, validating developers' premiumization strategies and buyers' appetite for premium offerings," said Samantak Das, Chief Economist and Head of Research and REIS, India, JLL

City-Wise Market Performance

Chennai emerged as the standout performer in 2025, recording a 31 per cent growth in annual sales, while major markets like Bengaluru and Delhi NCR experienced declines of 12 per cent and 22 per cent respectively. In the fourth quarter of 2025, Chennai and Delhi NCR maintained their momentum, with Chennai seeing an 86 per cent Y-O-Y growth in sales. Furthermore, Bengaluru, Delhi NCR, and Chennai led property price growth, each recording 13 per cent annual appreciation in capital values.

Trends in Housing Supply and New Launches

"Housing supply premiumization was evident in 2025, with premium segments growing 6% Y-o-Y while total launches dropped 3% to 293,079 units. New launches captured 23% of annual sales, showing buyer confidence despite market softening. Developers strategically prioritized higher-margin projects while being selective with mid-range launches based on city and micro-market level trends. Chennai led this transformation with 45% Y-o-Y supply growth, reflecting shift in buyers' preference from traditional houses to apartments amid evolving lifestyle preferences and end-user requirements," said Siva Krishnan, Senior Managing Director (Chennai & Coimbatore), Head - Residential Services, India, JLL.

Positive Outlook for Residential Sector

The outlook for the sector remains positive despite short-term volume adjustments. Recent repo rate cuts have reduced home loan rates, which improved credit access and expanded the buyer pool. JLL reports that, "home prices will continue rising, driven by strong demand, controlled inventory, and enhanced developer pricing power in premium segments, though growth rates may moderate going forward." (ANI)

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