In FY25, the Indian real estate sector saw substantial growth in home pricing, indicated by an overall weighted average launch price increase of 9% YoY across the top nine cities. PropEquity revealed the average price per square foot increased from ₹12,569 in FY24 to ₹13,197 in FY25, indicating that the sector was advancing (albeit slowly) regardless of the continued demand and supply challenges across the real estate segment.
Cities Driving the Price Surge
Out of the nine cities noted, Kolkata exhibited the highest price increase, at a 29% YoY growth. Following Kolkata was Thane at 17%, and Bengaluru at 15%. Pune and Delhi-NCR also saw increases of 10% and 5%, respectively. Other cities like Hyderabad and Chennai recorded more modest increases of 5% and 4%, respectively.
Interestingly, Mumbai and Navi Mumbai were exceptions, where average housing prices fell by 3% each, showcasing a slight correction in these otherwise high-demand markets.
Also Read: MahaRERA Directs Prominent Display of Registration Details in Real Estate Advertisements
City-Wise Price Trends
The report highlights the changing dynamics of average housing prices across these cities:
- Bengaluru: Prices rose to ₹9,852 per sq. ft. from ₹8,577 per sq. ft.
- Kolkata: Prices increased to ₹8,009 per sq. ft. from ₹6,201 per sq. ft.
- Chennai: Prices moved up to ₹7,989 per sq. ft. from ₹7,645 per sq. ft.
- Hyderabad: Prices climbed to ₹8,306 per sq. ft. from ₹7,890 per sq. ft.
- Pune: Prices rose to ₹10,832 per sq. ft. from ₹9,877 per sq. ft.
- Thane: Prices surged to ₹12,880 per sq. ft. from ₹11,030 per sq. ft.
- Delhi-NCR: Prices increased to ₹14,020 per sq. ft. from ₹13,396 per sq. ft.
- Mumbai: Prices dipped to ₹34,026 per sq. ft. from ₹35,215 per sq. ft.
- Navi Mumbai: Prices decreased to ₹12,855 per sq. ft. from ₹13,286 per sq. ft.
Two-Year Growth Insights
Housing prices in the cities mentioned above increased by 18% during the last two financial years (FY23-25). Bengaluru experienced the highest growth of 44%, followed by Kolkata (29%) and Chennai (25%). Thane saw 23% growth, while Delhi-NCR recorded 20%. Pune (18%), Navi Mumbai (13%), and Mumbai (11%) grew modestly. Growth was lowest in Hyderabad, where housing prices grew by 5%.
Factors Driving Price Appreciation
The rise in housing prices can be attributed to several factors:
1. Increased Input Costs: The cost of land, labor, and construction materials has steadily increased, pushing up overall project costs.
2. Changing Buyer Preferences: Evolving demand for larger homes and higher-quality properties has shifted the focus toward mid-segment and luxury housing.
3. Supply Constraints: A 34% dip in new housing supply, along with a 23% decrease in sales during January-March 2025, has tightened inventory, further supporting price growth.
4. Steady Demand in Key Markets: Cities like Bengaluru, Kolkata, and Thane have maintained strong buyer interest, driving higher pricing.
Market Insights and Outlook
Even with subdued demand and supply, the report points towards the long-term resilience of the Indian housing market. "Housing prices have appreciated between 10-30% in cities such as Bengaluru, Kolkata, Pune, and Thane. Although demand and supply have been subdued over the past year, rising input costs have firmed up prices," stated Samir Jasuja, the Founder and CEO of PropEquity.
The report additionally stated that average housing prices increased by 12% in FY24 among the top nine cities. Developers are said to take a more cautious approach moving forward, concentrating on calibrated launches consistent with their sales velocity.
Also Read: Where to Buy a Studio Apartment in Mumbai Within a Budget of ₹50–70 Lakh
Opportunities for Buyers and Developers
For purchasers, the increase in price reinforces the importance of getting in early to benefit from future appreciation. For developers, it means that there will be a focus on high-end and luxury segments as the needs of the market evolve.
Conclusion
The average price increase of new housing projects across India’s top 9 cities in FY25 was 9% YoY, which demonstrates the sector's continuing resilience and adaptability. Despite local differences, regional challenges and complications, the real estate market is still attracting interest from buyers and investors. Cities like Bengaluru, Kolkata and Thane are leading the price surge, and the attractiveness of Indian real estate is expected to strengthen and evolve, based on strong market fundamentals and changing buyer preferences.
Follow AquireAcers Whatsapp Channel to Stay Updated With The Latest Real Estate News
Ans 1. Housing prices rose by 9% year-on-year (YoY) in FY25, with the average price per square foot increasing from ₹12,569 in FY24 to ₹13,197.
Ans 2. Kolkata experienced the highest price surge with a 29% YoY growth, followed by Thane (17%) and Bengaluru (15%).
Ans 3. Yes, Mumbai and Navi Mumbai were the exceptions, where average housing prices declined by 3% each.
Ans 4. Housing prices across these cities grew by 18% between FY23 and FY25, with Bengaluru leading at 44%, followed by Kolkata (29%) and Chennai (25%).
Ans 5. The sector faced a 34% dip in new housing supply and a 23% decline in sales during January-March 2025, contributing to tightened inventory.
Ans 6. Buyers are encouraged to invest early to benefit from potential price appreciation, especially in high-demand cities like Bengaluru, Kolkata, and Thane.
Ans 7. Developers are likely to concentrate on high-end and luxury segments and adopt a cautious approach by aligning new launches with sales velocity.
Ans 8. The market remains resilient and adaptable despite regional challenges. Strong fundamentals, rising input costs, and evolving buyer preferences are expected to continue driving growth and interest from both buyers and investors.