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By:

Bhalchandra Chorghade

11 August 2025 at 1:54:18 pm

Real estate sentiment steadies ahead of 2026

India’s real estate sector appears to have regained its equilibrium in the final quarter of 2025, with stakeholder sentiment stabilising after a phase of moderation earlier in the year. The 47th edition of the Knight Frank–NAREDCO Real Estate Sentiment Index for Q4 2025 (October–December) indicates that both current and future outlooks remain firmly in the optimistic zone, underpinned by improving macroeconomic visibility, easing inflationary pressures and steady funding conditions. The...

Real estate sentiment steadies ahead of 2026

India’s real estate sector appears to have regained its equilibrium in the final quarter of 2025, with stakeholder sentiment stabilising after a phase of moderation earlier in the year. The 47th edition of the Knight Frank–NAREDCO Real Estate Sentiment Index for Q4 2025 (October–December) indicates that both current and future outlooks remain firmly in the optimistic zone, underpinned by improving macroeconomic visibility, easing inflationary pressures and steady funding conditions. The Current Sentiment Score edged up marginally to 60 in Q4 2025 from 59 in the preceding quarter, while the Future Sentiment Score held steady at 61. Although these readings remain below the peaks witnessed during 2023–24, they reflect a market that has absorbed recent volatility and is now progressing on more stable fundamentals. The stabilisation suggests that stakeholders are tempering expectations while retaining confidence in the sector’s medium-term prospects. A key driver of this optimism is the strengthening domestic macroeconomic environment. Real GDP growth accelerated to 8.2 per cent in Q2 FY 2025–26, a sharp improvement over the 5.6 per cent recorded in the corresponding period last year. High-frequency indicators continue to signal sustained economic momentum, helping offset global uncertainties. According to Shishir Baijal, Chairman and Managing Director, Knight Frank India, stronger macro visibility, steady funding conditions and disciplined decision-making across stakeholders have collectively reinforced confidence. He noted that calibrated residential supply and robust office leasing activity are providing structural support to the market. Funding availability sentiment also improved during the quarter. Most respondents expect liquidity conditions to remain stable or improve, aided by policy continuity and a sustained focus on asset quality. While lenders and investors continue to adopt a selective approach, capital access across asset classes remains supportive, indicating confidence in the sector’s underlying fundamentals rather than speculative expansion. Regionally, future sentiment strengthened modestly across all zones, with every region remaining in the optimistic zone. The South Zone retained its leadership position with a score of 62, driven by strong office leasing in Bengaluru and Hyderabad and resilient demand in higher-ticket residential segments. The East Zone improved to 62 on the back of steady mid-segment housing demand, while the West Zone also strengthened to 62, supported by stable commercial activity and a calibrated approach to residential development. The North Zone recovered to 59, reflecting stabilising sentiment after earlier softness, aided by steady office traction and ongoing infrastructure momentum. The broad-based regional improvement underscores confidence anchored in urban demand and improving economic conditions. Stakeholder sentiment, however, showed moderate divergence. Institutional stakeholders such as banks, financial institutions and private equity funds recorded a higher Future Sentiment Score of 63, reflecting growing confidence in asset quality and liquidity. Developers, in contrast, maintained a more cautious stance with a score of 58, highlighting a disciplined approach that aligns growth plans closely with demand visibility and funding prudence. This divergence points to a market where capital providers are willing to support growth, while developers remain focused on risk management and execution efficiency. In the residential segment, future sentiment improved in Q4 2025, supported by sustained demand in higher ticket size segments and careful inventory management. Although sales momentum has moderated from earlier peaks, improving financing conditions and controlled supply additions have reinforced confidence. Overall sentiment remains optimistic, characterised by stable demand rather than rapid expansion. The office sector continues to anchor overall market confidence. Leasing expectations remain strong, driven by sustained occupier demand, particularly from Global Capability Centres across major cities. Limited availability of quality Grade A space has encouraged pre-leasing and early commitments, supporting firm rental expectations. Sentiment around new office supply has also improved, indicating expectations of a stronger development pipeline even as near-term availability remains constrained. Parveen Jain, President, NAREDCO, observed that the index reflects confidence strengthening after a period of mild moderation, with residential stability and consistent office leasing forming the backbone of optimism. Taken together, the Q4 2025 findings suggest that India’s real estate sector is entering 2026 on a steadier, more balanced footing, guided by economic clarity, prudent capital deployment and demand-driven strategies across asset classes.

Bridge Snub

Tamil Nadu Chief Minister M.K. Stalin’s conspicuous absence during Prime Minister Narendra Modi inauguration of the new Pamban Sea bridge in Rameswaram was a calculated snub, and a clumsy one at that.


The Pamban bridge, which connects Rameswaram island to the mainland, is a marvel of modern engineering and a symbol of national investment in the region. Stalin’s refusal to attend its unveiling sent a signal of parochialism when the moment called for unity. After all, the bridge is not a BJP project but a national asset, decades in the making and financed by taxpayers across India. Its inauguration was not just Modi’s moment, but Tamil Nadu’s too.


While Stalin cited prior commitments, the boycott coincided with his public demand that the Prime Minister offer assurances on the proposed delimitation exercise, specifically that Tamil Nadu’s share of parliamentary seats would not be reduced in favour of states with higher population growth.


By skipping the event, Stalin squandered an opportunity to project Tamil Nadu not as a periphery, but as a partner in India’s infrastructure renaissance. The message he sent was one of narrow-minded provincialism—more akin to the rhetoric of a perpetual opposition leader than the statesmanship expected of a sitting chief minister. It was a moment to rise above political friction; instead, Stalin chose to sulk in the shadows.


To be sure, Stalin’s concern over the delimitation exercise is not without merit. Southern states like Tamil Nadu, which have successfully implemented family planning policies and brought down population growth rates, fear being punished for their good behaviour.


But the way to make that argument is through deliberation and diplomacy, not petulance. Stalin could have stood beside the Prime Minister at the ceremony, welcomed the bridge as a win for Tamil Nadu, and used the occasion to reiterate his call for fair and equitable representation.


Instead, he handed the Prime Minister the optics of national benevolence meeting regional small-mindedness. And in a place like Rameswaram, the birthplace of A.P.J. Abdul Kalam, who oversaw the earlier restoration of the old Pamban bridge during his presidency, such symbolism matters. Kalam belonged to both Tamil Nadu and India. Stalin, instead, chose to stand apart.


Such slights are not forgotten easily by Modi, whose political memory is long and strategic. A man with a finely tuned sense of symbolism, Modi is known to return every political cold shoulder with calibrated force. Stalin’s absence will not go unanswered; Tamil Nadu may find itself edged out of future high-visibility projects or economic largesse. The BJP does not yet hold sway in Tamil Nadu, but it has been making steady inroads. What better fuel for its rise than the optics of a petulant regional satrap refusing to share a stage with the elected leader of 1.4 billion people? India’s federalism is strongest when its leaders can disagree without disengaging. The Pamban bridge was built to connect; Stalin’s absence turned it into a metaphorical divide.

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