Real Estate grows but Affordable Housing Problems remain stable in 2025

Developers anticipate that after a fantastic 2024 characterized by robust pre-sales and price increases, the momentum in premium and luxury housing will continue in 2025. The future of affordable housing is still unclear, though, as developers are still leaving the market and buyers are delaying purchases because of rising interest rates and inflation.

According to a report by consulting firm JLL, pre-sales worth Rs. 5.1 lakh crore are expected to be generated by the end of the year across the top seven cities, making 2024 one of the best years ever for the residential real estate sector.

Analysts have pointed out that the rise in square footage has been restricted, even with extremely high pre-sale amounts and a respectable 10–11 percent increase in home prices. This suggests that growth will be concentrated on high-end real estate, with stress on mid-range and affordable housing expected to last until 2025 unless the Reserve Bank of India loosens its monetary policy and inflation declines.

"The demand for luxury and ultra-luxury residential real estate will grow at a faster rate than that of the affordable and middle-income segments. Developers will keep reevaluating their approaches and exercise caution when introducing new projects, according to a Colliers report analyzing the residential real estate market for 2025.

The demand for real estate in 2024 was primarily driven by premium and luxury developers. DLF, the most valuable listed developer in India, sold out of units in projects like Privana West, which was launched earlier this year, in three days due to strong demand from high-net-worth individuals and non-resident Indians.