Alignment in demand – supply across residential spectrum

As the rapid premiumisation seen over the last four years begins to stabilise, the housing market has entered a new phase of evolution with residential supply undergoing rebalancing. This structural shift in the supply mix has seen premium to entry level luxury homes emerging as the largest category.

Homes falling in the price bracket of INR 1.5 crore- INR 3 crore form the sweet spot for aspirational urban home buyers, emerging as the largest segment in new housing supply across top 7 cities. Amid these new residential development trends, homes priced below INR 75 lakh have declined significantly. 

A recent study conducted by Magicbricks between the last quarter of 2021 and the first quarter of 2026, tracking new housing supply across key ticket-size segments, reveals that the share of homes priced below INR 75 lakh has declined sharply from 47% to 17%, while the INR1.5–3 crore home  segment has nearly doubled its share from 16% to 31%, emerging as the largest category in India’s housing supply mix.

The findings of this study are significant, as they point out   that the dramatic shift towards premium housing has now stabilised. Across major ticket-size bands, supply shares have remained largely unchanged over the past year, indicating that the market is no longer moving further towards luxury, but is instead settling into a new equilibrium.

It’s worth noting that while luxury housing expanded significantly between 2021 and 2025, growth in the segment has now begun to plateau. Homes priced above INR 5 crore now account for around 9% of new supply, compared to just 2.5% four years ago, but their share has remained broadly stable over recent quarters.

Meanwhile, the mid-income segments between INR 75 lakh and INR 1.5 crore have displayed remarkable consistency, collectively contributing around 31% of national supply throughout the cycle. This segment continues to serve as a critical stabilising force in the market.

There are distinct regional trends across India’s largest housing markets. NCR appears to be correcting after a period of rapid premium expansion, with supply gradually shifting towards the INR1–3 crore segments. MMR continues to witness selective growth in luxury launches, while Bengaluru has maintained a steady premium and luxury-driven trajectory supported by strong end-user demand. Hyderabad remains one of the fastest-growing markets, although its supply trends continue to exhibit greater volatility compared to other metros.

The next phase of growth for the residential sector will be driven less by shifts in ticket-size mix and more by sustained absorption levels. With the market having largely completed its premiumisation cycle, future supply growth will increasingly depend on maintaining healthy demand across core mid-premium categories.

The research data also reinforces the need for targeted interventions to revive affordable housing supply. Rising land costs, construction expenses and development economics continue to constrain new launches in the sub-INR75 lakh category, limiting the segment’s share in organised residential supply.

Amid maturing housing market, the current phase of stability reflects a structurally healthier ecosystem marked by greater pricing discipline, balanced supply distribution and stronger alignment between developer launches and buyer demand.