Red Alert for Real Estate! Major Drop in Home Sales Sparks Fears of Market Cooldown

India’s residential market has run into a sharp speed bump. For the first time in 14 quarters, residential sales in the country’s prime cities have dropped below the 1 lakh unit level, says a new report from NSE-listed real estate analytics company PropEquity.

During Q2 2025 (April–June), residential sales in nine large Indian cities fell 19% year-on-year to 94,864 units from 116,432 units during the corresponding quarter last year. Supply also fell 30% YoY at 82,027 units, the fourth consecutive quarter when new inventory remained below 1 lakh units.

This is the first time since Q3 2021 that sales as well as supply have both been below the 1 lakh unit level at the same time, which has raised eyebrows over a possible cooling-off after several years of post-COVID realty boom.

According to the report, 7 out of 9 cities saw a year-on-year decline in housing sales, with Mumbai and Thane witnessing the sharpest dips at 34% each. The only exceptions were Delhi-NCR and Chennai, where sales rose by 16% and 9% respectively.

On the supply side, Mumbai again led the fall with a 61% decline, while Delhi-NCR (+37%), Hyderabad (+19%), and Chennai (+6%) were the only cities to report growth.

This is a crucial inflexion point,” said Samir Jasuja, PropEquity Founder and CEO. “Cities like Mumbai, Navi Mumbai, and Bengaluru, which were on a high in 2023 and 2024, are now stabilizing to more realistic levels.

Quarter-to-quarter, the figures show a 10% decline in sales and a 2% increase in supply. Chennai, Hyderabad, Kolkata, Pune, and Delhi-NCR registered increasing inventory, but only four cities, namely Chennai, Hyderabad, Kolkata, and Delhi-NCR, had an increase in sales compared to the last quarter.

The growth of Delhi-NCR was driven mainly by activity in Ghaziabad and Greater Noida, the report added.

With sales and supply both slowing down, experts feel India’s real estate market could be on the cusp of a correction and consolidation cycle following a long bull run.