India’s residential real estate market remained resilient in FY’26, with housing sales across 75 cities declining only marginally by ~1% year-on-year. Despite the slight volume dip, total sales value rose nearly 16%, reflecting a continued cycle of premium housing and higher-value transactions. City-level performance was mixed, NCR emerged as the strongest performer with ~11% sales growth, while Ahmedabad and Bangalore also witnessed healthy momentum. MMR, contributing ~24% of pan-India sales, registered moderate growth of ~4%. In contrast, Pune recorded the sharpest decline at ~25%, while Tier-II and Tier-III cities collectively fell ~4%.

The supply side was the defining story of FY’26. The year closed with a landmark quarter — recording the highest-ever quarterly supply addition of approximately 1.72 lakh new units. The top eight metropolitan cities led this expansion, contributing ~1.22 lakh units at ~12% QoQ growth, while Tier-II and Tier-III cities added close to 50,000 units at ~10% QoQ growth. For the full year, new launches rose ~10%, underscoring the increasingly broad-based nature of India’s residential expansion.

This supply momentum has pushed unsold inventory to nearly 12 lakh units, with monthly overhang at ~20 months for Tier-I and ~19 months for Tier-II/III cities — levels that remain within healthy thresholds.

Housing prices continued to strengthen, with the pan-India price index rising ~3% YoY. NCR outperformed, with Ghaziabad appreciating up to 9% and Bangalore at ~7%. Pan India, ~61% of projects recorded 0–10% price growth, while 17% exceeded 10% appreciation. However, construction activity has not kept pace with supply additions. Project execution delays and slower construction progress across several regions, combined with aggressive new launches and rising unsold inventory, point to emerging execution risks in certain market pockets.

Market Broadening Beyond Large Developers

One of the most notable trends emerging from the latest residential market data is the increasing participation of smaller and regional developers. This indicates that the market is becoming more broad-based, rather than remaining concentrated among a limited number of large players.

The distribution of new housing supply across developer categories highlights a more balanced market structure, with 59 Mega large developers contributing 18% of total new launches, accounting for nearly 1.1 lakh units during the period. Smaller developers collectively contributed nearly 1.81 lakh units (29%), surpassing larger players in terms of total unit contribution.

The expansion was also visible in the overall developer base. The number of active developers increased significantly to around 17,679 active developers in the market throughout the year. This trend suggests that the post-pandemic phase of market consolidation may now be moderating, with smaller regional developers gradually re-entering the market as housing demand stabilizes and financing conditions improve.

Mid-Segment Housing Witnesses Revival

Supply trends also indicate a revival in the mid-income housing segment, challenging the broader perception that residential launches are dominated only by luxury and ultra-luxury projects going forward.

Key Pricing Segments Driving Supply

• ₹50 lakh to ₹5 crore emerged as the dominant supply range.

• The ₹1 crore–₹1.5 crore segment recorded the largest contribution to overall launches 83,430 launches

• The ₹50 lakh–₹75 lakh segment emerged as the third-largest contributor, reflecting renewed activity in relatively affordable mid-segment housing.

• Importantly, affordable housing activity also remained visible in the market.

• Nearly 34,000 units priced below ₹30 lakh were launched during the period.

The data suggests that residential supply is now becoming more diversified across price categories, with developers targeting a wider buyer base rather than focusing exclusively on premium housing segments.

Outlook

The Indian residential market is entering a transitional phase — moving away from a purely consolidation-driven cycle toward a more decentralized and broad-based growth phase. Sales momentum, while stable, shows signs of gradual moderation, even as rising new supply and growing participation from smaller developers reflect deepening market confidence beyond the top-tier players. A revival in the mid-income segment adds further breadth to demand, complementing the premiumization trend that has driven value growth over the past year. Price appreciation, while continuing, is expected to remain moderate and increasingly project specific. However, emerging execution and inventory risks will need careful navigation, as aggressive supply additions outpace construction progress in several markets. Sustained monitoring of inventory levels, construction timelines, and absorption trends will be critical in assessing the market’s medium-term stability and ensuring that this phase of expansion translates into durable, structurally sound growth.