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The global luxury housing market has seen mixed fortunes this year, but India continues to shine on the world stage. According to Knight Frank’s Prime Global Cities Index (PGCI) Q2 2025, Bengaluru has achieved a historic milestone by securing the 4th spot among 46 international cities in terms of premium property price growth. With a 10.2% year-on-year increase, the city has overtaken Mumbai and reaffirmed its status as one of the most dynamic luxury real estate markets in the world.
This achievement not only highlights Bengaluru’s growing importance in the global property landscape but also signals the resilience of India’s premium housing sector despite a cooling global trend.
Bengaluru Leads Among Indian Cities
Bengaluru recorded an impressive 10.2% rise in luxury housing prices, the highest among Indian metros. Once considered primarily an IT and start-up hub, the city has steadily evolved into a luxury housing hotspot, attracting high-net-worth individuals (HNIs) and global investors.
Several factors have contributed to Bengaluru’s performance:
- Tech-driven wealth creation: The city continues to generate wealth through its strong IT, biotech, and start-up ecosystems, creating a steady demand for luxury homes.
- High quality of life: Modern infrastructure, international schools, and a cosmopolitan lifestyle are making Bengaluru a preferred choice for affluent buyers.
- Growing investor confidence: Developers are increasingly launching ultra-premium projects tailored for a global clientele.
This momentum has pushed Bengaluru past Mumbai, a city long regarded as India’s luxury housing capital.
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Mumbai and Delhi Hold Strong Positions
While Bengaluru leads the pack, Mumbai and Delhi also remain strong contenders in the global index.
- Mumbai ranked 6th globally with 8.7% growth in prime property prices. Infrastructure developments like the coastal road project and the metro expansion have enhanced the city’s appeal, making luxury housing more accessible and desirable.
- Delhi secured the 15th position with 3.9% growth. Despite slower appreciation compared to Bengaluru and Mumbai, the city maintains steady demand for premium homes, backed by limited supply in core luxury zones such as Lutyens’ Delhi and prime Gurgaon neighborhoods.
Together, these three metros highlight India’s rising prominence in the global luxury real estate map.
Global Context: How Indian Cities Compare
India’s strong showing becomes even more striking when placed in the context of global performance.
- Seoul topped the list with a staggering 25.2% annual growth.
- Tokyo followed at 16.3%, driven by high demand and limited prime housing stock.
- Dubai, long a magnet for global luxury investors, ranked 3rd with 15.8% growth.
In contrast, the average global premium property price growth stood at just 2.3%, reflecting a slowdown in many established markets. This gap underscores the resilience and attractiveness of Indian luxury real estate compared to its global peers.
Expert Insights
Knight Frank’s leadership has shed light on the factors shaping these trends:
- Shishir Baijal, Chairman and Managing Director of Knight Frank India, emphasized that wealth creation in India’s urban hubs, infrastructure growth, and increasing demand for luxury homes have kept premium housing prices on an upward trajectory.
- Liam Bailey, Global Head of Research at Knight Frank, noted that while global luxury housing markets are cooling, recovery patterns remain fragmented, and India stands out as one of the few regions bucking this trend.
Their insights confirm that India’s premium real estate is not just growing—it is thriving against global headwinds.
Why India’s Luxury Housing Defies the Global Trend
Unlike several international markets facing corrections, India’s luxury housing sector continues to defy gravity. Key reasons include:
- Economic resilience: A robust economy and rising urban incomes are fueling sustained housing demand.
- Wealth creation hubs: Cities like Bengaluru and Mumbai are producing a new generation of millionaires and entrepreneurs eager to invest in premium real estate.
- Redevelopment & infrastructure pipeline: Large-scale urban redevelopment and infrastructure upgrades are unlocking new luxury corridors.
- Limited supply: In many prime micro-markets, supply constraints are naturally driving up prices.
These factors collectively explain why premium property price growth in India is significantly outpacing the global average.
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Outlook for H2 2025
The outlook for the remainder of 2025 remains promising across India’s key luxury markets:
- Bengaluru is expected to maintain momentum, supported by sustained demand from IT professionals, global investors, and start-up founders.
- Mumbai could witness further appreciation as mega infrastructure projects near completion, unlocking new premium residential corridors.
- Delhi is likely to retain stability, with steady demand for prime housing in central and NCR luxury areas.
Experts believe that as wealth creation accelerates, India’s luxury housing demand will continue to expand, keeping premium property price growth on a positive trajectory.
Conclusion
Bengaluru’s leap to the 4th position globally is a defining moment for India’s real estate sector. Surpassing Mumbai in luxury housing growth highlights the city’s transformation into a global hotspot for premium living. Alongside Mumbai and Delhi, it reinforces India’s place among the world’s most resilient and fastest-growing prime housing markets.
As global luxury markets show uneven recovery, India’s consistent performance proves its ability to sustain premium property price growth through a mix of economic resilience, infrastructure expansion, and rising demand. Looking ahead, the second half of 2025 promises continued momentum, further strengthening India’s standing in the global luxury real estate landscape.
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Ans 1. Bengaluru has secured the 4th spot globally in Knight Frank’s Prime Global Cities Index Q2 2025, recording a 10.2% year-on-year rise in premium housing prices. This is the highest growth among Indian cities and a major leap ahead of Mumbai.
Ans 2. It shows the city’s transformation from being primarily an IT hub to becoming a leading luxury housing market. Strong wealth creation, lifestyle appeal, and investor confidence have fueled this growth.
Ans 3. Mumbai ranked 6th globally with 8.7% growth in prime property prices. Large infrastructure projects like the coastal road and metro expansion have added to its luxury housing appeal.
Ans 4. Delhi secured the 15th position with 3.9% growth. Although slower than Bengaluru and Mumbai, it continues to see steady demand in core premium areas like Lutyens’ Delhi and upscale Gurgaon.
Ans 5. Seoul led with 25.2% annual growth, followed by Tokyo at 16.3% and Dubai at 15.8%. Bengaluru ranked just below them, placing India firmly among the global leaders.
Ans 6. While the global average premium property growth was only 2.3%, Indian cities like Bengaluru and Mumbai posted much higher numbers. This shows India’s resilience even as global luxury markets slow down.
Ans 7. Wealth from IT, biotech, and start-ups, along with modern infrastructure and cosmopolitan living, have made the city attractive for affluent buyers. Developers are also introducing ultra-premium projects to meet global standards.
Ans 8. Strong economic fundamentals, rising urban wealth, and infrastructure development are sustaining demand. Limited supply in prime zones is also pushing property prices upward.
Ans 9. Bengaluru is likely to sustain its growth momentum, while Mumbai could benefit further as key infrastructure projects finish. Delhi should remain stable with consistent demand in prime neighborhoods.
Ans 10. It highlights India as one of the most resilient and fastest-growing luxury property markets worldwide. With Bengaluru surpassing Mumbai, the country now has multiple cities competing on the global stage.