2025 Property Market Trends: Key Factors Influencing Home Buying Decisions

The year 2024 was a standout year for the Indian real estate market, particularly in the luxury segment, which saw strong growth thanks to high-net-worth individuals and non-resident Indians driving demand. According to JLL’s report, housing sales hit a new peak in the first three quarters of 2024, with nearly 230,000 homes worth Rs 380,000 crore sold across the top seven cities.

This positive momentum has carried over into 2025, with the housing sector continuing to thrive due to solid economic fundamentals, evolving buyer preferences, and favorable policy outlooks. The luxury housing segment, in particular, is expected to see continued strength in 2025, reflecting the overall trend of premiumization.

Peripheral micro-markets around metro cities have emerged as key drivers of growth in the real estate landscape, with significant price appreciation observed. Over the past six years, prices in these areas have risen by up to 69%, outpacing growth in prime city locations. This trend is likely to continue in 2025, offering attractive options for both homebuyers and investors looking for long-term value.

For instance, in Noida Expressway, average residential prices increased by 66% in the last six years, while Dwarka Expressway saw a significant 93% jump during the same period. This steady increase in home prices reflects the strength and stability of the Indian housing sector, driven by growing buyer and investor confidence in the market’s potential.

According to Sachin Gawri, Founder and CEO of RISE Infraventures, the Indian real estate market is set for further expansion in 2025, driven by favorable interest rates, economic stability, and changing buyer preferences. The sector is experiencing a shift towards emerging micro-markets and new investment opportunities, attracting increased demand from investors seeking untapped potential.

Additionally, affordability in the housing sector is expected to improve in 2025, with projected interest rate cuts making homeownership more accessible. Lower home loan EMIs could open up new opportunities for middle-income groups and first-time buyers, potentially stimulating demand in the residential real estate market and contributing to overall economic growth.

Manoj Gaur, President of CREDAI-NCR and CMD of Gaurs Group, notes that while luxury housing remains in demand, affordability is a key factor for many homebuyers. Anticipated interest rate cuts in 2025 are expected to enhance affordability and drive demand across various market segments, highlighting the sector’s resilience.

In conclusion, 2025 is shaping up to be another significant year for Indian real estate, driven by strong demand, policy support, and a growing luxury market. Developers and investors stand to benefit from the opportunities arising in this dynamic landscape, making it an exciting time for the industry.