India’s residential market demonstrated healthy momentum in Q1 2026 (January-March), with sales reaching 70,631 units, marking an 8% Y-o-Y growth. This growth was significantly underpinned by a remarkable surge in new launches, which totalled 90,023 units – a 13% increase Y-o-Y and a substantial 32% jump quarter-on-quarter. The strong supply pipeline from reputed developers provided buyers with diverse options and reinforced confidence in market stability, translating into steady sales growth.  However, the market showed a slight moderation in momentum, with sales growth at 8% compared to launch activity at 13% Y-o-Y growth, reflecting a more measured buyer approach in response to current economic conditions.

Sales growth was mainly fuelled by strong performance in the premium segment, with homes priced above INR 1 crore recording 30% Y-o-Y growth, particularly in the INR 1.5-3.0 crore category. The gap between robust supply additions and measured sales growth suggests a short-term market recalibration, where developers remain confident in launching new projects driven by premiumization trends and solid long-term fundamentals, while buyers appear to be taking a more cautious approach, thoroughly assessing their options before committing to purchases.

Bengaluru, Mumbai, Pune, and Delhi NCR—the four cities exceeding 10,000 unit sales—together represented approximately 77% of Q1 2026 sales. These markets benefit from strong corporate presence, including numerous multinational corporations and startups that generate substantial employment, along with continuous infrastructure development enhancing their appeal as residential destinations.

Chennai led with exceptional 61% year-on-year sales growth, propelled by robust IT sector employment and enhanced connectivity. Delhi NCR recorded 30% year-on-year growth, supported by new infrastructure initiatives and accumulated demand, while Bengaluru posted 18% growth driven by quality supply and ongoing office sector expansion. In contrast, Pune experienced a 14% year-on-year decline, coinciding with reduced launch activity during the quarter.

The strong correlation between launches and sales continued in Q1 2026, with projects launched during the quarter contributing significantly (~26%) to overall Q1 sales volume. Launches by reputed developers with assurance of timely delivery and steady price appreciation continue to drive this trend.

“The residential market is navigating a transitional phase where robust supply is meeting with measured buyer sentiment. While launches have surged 13% year-on-year, sales growth of 8% suggests buyers are exercising greater discretion amid economic uncertainties. This temporary divergence is not unusual and reflects a healthy market adjustment and not a structural concern. The strong performance of the premium segment—homes priced INR 1 crore and above grew 30% year-on-year—demonstrates that underlying demand fundamentals remain strong, particularly among affluent buyers who are less sensitive to short-term economic fluctuations,” said Siva Krishnan, Senior Managing Director (Chennai & Coimbatore), Head – Residential Services, India, JLL.

The premium housing segment dominated market performance in Q1 2026, with apartments priced above INR 1 crore accounting for 71% of total sales, up from 59% in Q1 2025, marking a 30% year-on-year growth. The INR 1.5-3.0 crore segment led this expansion with an exceptional 67% year-on-year increase, reflecting strong buyer preference for spacious, well-appointed homes in prime locations. Conversely, the sub-INR 1 crore segment contracted 24% year-on-year, with its market share declining to 29% from 41%. This sustained shift reflects rising land and construction costs, limited affordable housing supply in core urban areas, and developers’ strategic focus on higher-margin premium projects that align with evolving buyer preferences for quality over entry-level options.

Despite signs of moderating sales momentum, the 13% Y-o-Y surge in new launches, totalling 90,023 units in Q1 2026, reflects strong developer confidence in India’s urbanization trajectory and rising affluence. Bengaluru led with 27,055 launches (up 32% Y-o-Y), while Delhi NCR recorded exceptional 64% year-on-year growth, with both cities accounting for 45% of total quarterly launches. The divergence between launch and sales growth represents developers’ strategic focus on medium to long-term demand projections rather than short-term market fluctuations.  This robust supply pipeline, particularly from reputed developers offering quality projects in prime locations, demonstrates that developers view current buyer caution as temporary and are positioning themselves to capitalize when economic conditions stabilize.

Premium segment price appreciation drives overall market value growth despite slower sales momentum

Residential property prices in India’s top seven cities continued their upward trajectory in Q1 2026, with Y-o-Y increases ranging from 8% to 20%. This sustained appreciation reflects strong underlying demand fundamentals, rising land and construction costs, and the shift toward premium product offerings. With ongoing construction and operational cost pressures, property prices are likely to keep increasing, though the rate of growth may slow if sales growth remains measured.

Looking Ahead: Market Recalibration Sets Stage for Supply-Led Growth

India’s residential sector enters 2026 with strong fundamentals including rising affluence, ongoing urbanization, infrastructure development, and sustained premiumization trends. While near-term economic uncertainties have led buyers to adopt a more measured approach, the substantial supply pipeline—particularly in the premium segment—is well-positioned to meet demand as confidence stabilizes. The long-term outlook remains positive, supported by India’s demographic advantages, increasing household incomes, declining home loan interest rates, and growing preference for modern, well-connected residences. The robust launch activity combined with healthy sales conversion demonstrates solid market fundamentals. As economic clarity improves, the sector is poised for continued growth, driven by sustained premium housing demand, infrastructure improvements, rising urbanization, higher disposable incomes, and favorable financing conditions.