India home sales flat as new launches rise

India’s residential real estate market recorded 258,238 home sales across its eight largest cities in the first nine months of 2026, identical to the same period the prior year. Developers introduced 279,899 new units, marking a 4% rise, but sales did not match the pace of new developments, leaving approximately 21,700 unsold properties on the market.

The imbalance between new supply and buyer demand has lasted for 16 consecutive quarters. During the third quarter alone, sales declined by 1% to 86,767 units, while new launches climbed 4% to 92,549. The slowdown in sales absorption is reflected in the “quarters to sell” metric, which increased to 6.1 in July–September from 5.8 in the same period a year earlier—the highest level since mid-2023.

Mumbai led the market with 72,804 units sold, a 1% increase, and 72,673 new launches, up 13%, representing 28% of national sales. Bengaluru and Pune saw sales rise by 5% and 1%, respectively. However, the National Capital Region (NCR) was the only major market to experience a contraction, with sales dropping 11% to 35,574 units.

Buyer preferences have shifted decisively toward higher-value properties. Homes priced above ₹1 crore now account for 55% of all sales, up from 50% in the previous year, while properties below ₹50 lakh now represent just 18% of the market. The ₹2–5 crore segment experienced the fastest growth, increasing 19.4% to 51,501 units. In contrast, the NCR’s ₹5–10 crore segment weakened significantly, with sales falling 39% to 4,033 units. Gurugram alone holds 57% of the region’s unsold inventory.

Price growth remained steady across all tracked markets, with Bengaluru seeing an 11% annual increase. Other cities experienced growth rates between 3% and 6%. Knight Frank attributes Bengaluru’s sharp rise in part to a higher concentration of premium stock in its inventory-weighted average.

This market behavior reflects a broader change in buyer priorities. Shishir Baijal, chairman of Knight Frank India, observes that the “quality and relevance of supply” will now play a key role alongside demand strength. The trend toward premium segments and slower absorption suggests a stabilization phase rather than an overall downturn. Macroeconomic conditions remain favorable, with GDP growth at 7.8% in the second quarter, surpassing the Reserve Bank of India’s 7% target, though monetary policy no longer provides additional support.

Developers have not adjusted their strategies despite the slowdown. The 4% increase in new launches indicates confidence in sustained demand, particularly in mid-to-premium segments. However, the growing gap between supply and sales, now standing at 21,700 units, raises concerns about how quickly inventory can be absorbed at current pricing levels.