14 April,2025 01:39 PM IST | Mumbai | mid-day online correspondent
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The Indian real estate market has shown mixed trends as affordable housing stock has witnessed a significant decline, while luxury housing has experienced a notable increase in unsold inventory, as per the latest research by ANAROCK. The unsold stock in the affordable housing segment, priced below Rs 40 lakh, has fallen by 19 per cent year-on-year, from around 1.40 lakh units by the end of Q1 2024 to approximately 1.13 lakh units by the end of Q1 2025.
In contrast, the luxury housing market, which typically caters to homes priced above Rs 1.5 crore, has seen a 24 per cent rise in unsold units. From 91,125 unsold units at the end of Q1 2024, the number has surged to over 1.13 lakh units by Q1 2025, highlighting a significant uptick in supply despite a cautious investor sentiment and global economic uncertainties.
The shift in demand across cities paints a varied picture. Among the major cities, Bengaluru led the decline in affordable housing stock, seeing the steepest drop of 51 per cent. Chennai followed with a 44 per cent decrease, while Hyderabad was the only city to register an increase in affordable housing stock, with a 9 per cent rise. The surge in Hyderabad's affordable stock saw it climb to approximately 1,815 unsold units by Q1 2025, in stark contrast to the declines seen in other cities.
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In terms of the luxury housing market, Chennai and Pune were the only cities to see a decrease in unsold stock. Chennai experienced a 4 per cent drop in its luxury housing inventory, while Pune saw an 11 per cent decline. On the other hand, the remaining five cities - NCR (National Capital Region), MMR (Mumbai Metropolitan Region), Kolkata, Hyderabad, and Bengaluru - saw an increase in their unsold luxury housing stock, reflecting the growing supply in this segment.
The affordable housing segment, which had been severely impacted by the pandemic, has seen a steady decline in unsold stock over the past year. According to ANAROCK data, the total unsold inventory in affordable housing across the top seven cities has reduced from 1.40 lakh units at the end of Q1 2024 to 1.13 lakh units at the end of Q1 2025. The reduction of 19 per cent in unsold units signals that there is sustained demand from end-users, even as the supply in this category remains restricted.
Bengaluru has shown the most remarkable recovery in the affordable housing category, with a sharp 51 per cent annual decline in unsold stock. Chennai followed closely, registering a 44 per cent reduction. Hyderabad bucked the trend with a modest 9 per cent increase, suggesting a growing appetite for affordable housing in this market.
On the other hand, the luxury housing segment saw a surge in unsold inventory over the same period, rising by 24 per cent. From approximately 91,125 unsold units at the end of Q1 2024, the unsold stock of luxury housing increased to over 1.13 lakh units by Q1 2025. This increase is largely attributed to the substantial addition of new supply in the market, even as demand from investors and high-net-worth individuals (HNIs) remains cautious due to global economic uncertainty.
Cities such as NCR saw a substantial 78 per cent increase in unsold luxury housing stock, while Bengaluru also experienced a significant 57 per cent rise in luxury unsold units. Kolkata witnessed the most dramatic growth in luxury housing, with a 96 per cent increase in unsold stock. Despite this, Chennai and Pune experienced a decline in luxury stock, with reductions of 4 per cent and 11 per cent, respectively, as demand for this segment remained relatively tepid.
The mid-segment housing (priced Rs 40-80 lakh) also showed a decline in unsold stock, down by 10 per cent from approximately 1.75 lakh units at the end of Q1 2024 to around 1.58 lakh units by Q1 2025. Meanwhile, the premium segment (priced INR 80 lakh to INR 1.5 crore) saw its unsold stock remain largely unchanged during the same period, indicating stable demand in this category despite a slight dip in supply.
Market outlook
The overall unsold stock across all budget categories in the top seven cities declined by just 4 per cent during the period, from 5.81 lakh units at the end of Q1 2024 to 5.60 lakh units by the end of Q1 2025. This indicates a mixed recovery, with some segments (affordable housing) seeing improvements, while others (luxury housing) are dealing with an increase in unsold inventory.
Anuj Puri, Chairman of ANAROCK Group, pointed out that the affordable housing segment bore the brunt of the pandemic's fallout. Sales and new launches were severely impacted, with the share of affordable housing sales dropping from 38 per cent in 2019 to just 18% in 2024. Similarly, the supply share for affordable housing fell from 40 per cent to 16 per cent in the same period.
However, Puri noted that the 19 per cent decline in unsold stock suggests that demand is holding steady, driven largely by end-users. In contrast, the luxury housing segment experienced a sharp rise in unsold stock despite robust demand in previous years. Puri attributed this to an increase in new supply and more cautious investor sentiment amid global uncertainties.
