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Housing sales fall 4% in Q1 2026; Mumbai, NCR, Pune drag amid high prices, US-Iran war; Affordable housing dips
Despite softer sales volumes, property prices remained firm. Ghaziabad and Greater Noida led home price growth, while Mumbai remained the most expensive market
Housing sales across India’s top eight cities moderated by 4% year-on-year in Q1 2026 to 84,827 units, down from 88,361 units in the same period last year, according to Knight Frank. The dip signals early signs of recalibration amid global uncertainties, including geopolitical tensions such as the US-Iran conflict, following a prolonged period of strong growth.
Sales declined in key markets, including Mumbai (down 7% to 23,185 units), Delhi-NCR (down 11% to 12,734 units), and Pune (down 11% to 12,711 units). In contrast, demand remained resilient in Bengaluru (up 5% to 13,092 units), Hyderabad (up 1% to 9,541 units), and Chennai (up 9% to 4,763 units), with additional growth seen in Ahmedabad and Kolkata.
New supply also declined marginally by 2% to 94,855 units during the quarter. Launch activity slowed across most cities, except Bengaluru, Chennai, and Ahmedabad. NCR recorded the sharpest drop in new launches at 8% YoY, followed by Hyderabad and Kolkata (down 6% each), while Pune and Mumbai saw relatively smaller declines of 5% and 1%, respectively.
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Despite softer volumes, prices remained elevated. Ghaziabad and Greater Noida led price growth with YoY increases of 13% and 11%, respectively, while Mumbai remained the most expensive residential market, with a weighted average price of ₹36,049 per sq ft.
Demand remained skewed toward premium housing. Sales of homes priced above ₹1 crore grew 11% YoY, even as the sub- ₹50 lakh and ₹50 lakh– ₹1 crore segments contracted by 23% and 12%, respectively. The ₹1–2 crore segment drove much of this growth, rising 10% YoY and accounting for 29% of total sales. Higher-end categories also saw strong traction, with sales increasing 17% in the ₹2–5 crore segment, 12% in the ₹10–20 crore segment, and a sharp 80% surge in the ₹20–50 crore bracket.
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“The moderation in residential demand observed in Q1 2026 warrants closer attention, particularly as it follows a sustained multi-year upcycle. While this phase can be partly attributed to a natural consolidation after strong growth, the continued rise in prices alongside softening volumes indicates growing pressure on affordability and absorption. At the same time, a volatile geopolitical situation leading to sustained correction in the equity markets has also resulted in subdued interest in residential demand,” said Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India.
“The divergence in market performance, with demand increasingly concentrated in higher ticket sizes, underscores the need to support the sub- ₹1 crore segment more actively. This category remains critical for maintaining transaction volumes and overall market depth. Targeted measures to improve sales in this segment will be important to sustain momentum. While critical underlying demand drivers, such as economic growth and home loan rates, remain intact, and the current phase is not indicative of a structural slowdown but a caution to maintain a delicate balance requiring proactive monitoring, incentives for purchase and policy support,” he said.
