State of the Industry Report: Real Estate in India 2025

The Indian real estate sector is undergoing a pivotal transformation in 2025, shaped by rapid urbanisation, regulatory reforms, technological disruption, and evolving consumer expectations.

With a GDP contribution of approximately 7.3% and an anticipated growth trajectory to reach US$1 trillion by 2030, the sector continues to demonstrate resilience and long-term promise despite intermittent global and domestic challenges.

Investor confidence remains strong, buoyed by government initiatives, digital innovation, and renewed focus on affordable housing. However, headwinds including rising construction costs, fluctuating interest rates, and urban infrastructure constraints demand strategic recalibration across the industry.

Key Trends Shaping 2025

1. Residential Market Rebound

Demand for residential real estate is rebounding strongly post-pandemic, particularly in Tier 2 and Tier 3 cities. With hybrid work arrangements now entrenched, homebuyers are prioritising larger homes, integrated townships, and wellness-focused communities.

Luxury housing has surged by 20% in major metros like Mumbai, Bengaluru, and Delhi NCR.
Affordable and mid-segment housing remains the backbone of volume growth, driven by government subsidies under schemes such as PMAY (Pradhan Mantri Awas Yojana).

2. Commercial Real Estate Recovery

While traditional office space demand remains soft in certain metros, Grade-A office leasing has strengthened, supported by the IT, BFSI, and co-working sectors.

Flex spaces are forecasted to account for 20% of total office absorption by the end of 2025.India’s emergence as a global GCC (Global Capability Centre) hub continues to fuel demand for world-class commercial properties, particularly in Hyderabad and Bengaluru.

3. Industrial and Logistics Growth

The warehousing and logistics segment is one of the fastest-growing, underpinned by:

The government’s Gati Shakti initiative.
E-commerce expansion.
Demand for last-mile delivery hubs.Tier 2 cities are increasingly becoming investment hotspots for logistics parks and distribution centres.

4. Technology and PropTech Revolution

Digital adoption in real estate has accelerated, with AI, blockchain, virtual reality (VR), and IoT integration becoming standard.

Online property transactions have gained mainstream acceptance.
Smart home technologies and energy-efficient buildings are now highly sought-after by buyers and tenants alike.

5. Sustainability and Green Buildings

Sustainability has moved from being a ‘nice to have’ to a business imperative.Developers are increasingly embracing green certifications such as IGBC (Indian Green Building Council) and EDGE.Net-zero commitments by leading developers are reshaping design and operational models.