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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.

Who is the ‘Booster’ that Fadnavis mentions?

CM Devendra Fadnavis with Dy CM Eknath Shinde flags off the trial run and technical inspection of Phase-1 of Mumbai Metro Route-9 on Wednesday. Pic: PTI
CM Devendra Fadnavis with Dy CM Eknath Shinde flags off the trial run and technical inspection of Phase-1 of Mumbai Metro Route-9 on Wednesday. Pic: PTI

Mumbai: Amidst speculations about reunion of the estranged Thackeray and Pawar cousins, Fadnavis’ mention of possible ‘booster’ for the Mahayuti alliance in the state has raised many eyebrows. However, it appears that to know who is likely to be the booster for the ruling alliance, one is likely to have to wait and watch.


Chief Minister Devendra Fadnavis flagged off trial run of Mumbai Metro Line 9 from Dahisar to Kashigaon on Wednesday. In his speech after inspecting the newly built elevated road, along with Deputy Chief Ministers Eknath Shinde and Ajit Pawar, the CM mentioned the ‘Booster’ for the ruling alliance which has led to more speculations. The CM said, “We three in Mahayuti are firmly together and we have set into motion the Development Express. No one can now lay speed breakers on its way. It’s a different thing if anyone wants to give a booster to it, but one thing is sure that there is no space for any speed breaker now.” This statement has now led to speculations about its underlying message.


After the SC decision on local body polls in the state, there has been a sudden increase in the political activities. After Raj Thackeray indicated that he is open to joining hands with Uddhav, Sharad Pawar’s statements fanned speculations on unification of the two factions of the NCP. Also, several local leaders have either joined or are in the process of joining the ruling alliance. On this backdrop Fadnavis’ mention of the ‘booster’ today is being interpreted as an indication of some big leader from the opposition might be joining the ruling alliance.


MNS Chief Raj Thackeray had a long meeting with industries minister Uday Samant on Tuesday. Raj had also had several meetings with DCM Shinde and CM Fadnavis in the recent past. It has also been speculated that he might join hands with the ruling alliance in the local body polls.


On the other hand NCP (SP) state president Jayant Patil too is said to be in a queue to join the ruling alliance. Recently he had invited union minister Nitin Gadkari to inaugurate a hostel at his home town Islampur in Sangli district, which had fanned the speculations of him joining the BJP. Also, Sharad Pawar’s recent statements indication possible reunion of the two factions of the NCP, has strengthened the speculation.


On this backdrop, Fadnavis’ mention of the possible “booster” for the ruling alliance has created a new stir in the state politics.


Nobody can hamper development: Fadnavis

Thane: Maharashtra Chief Minister Devendra Fadnavis on Wednesday targeted the opposition parties, saying nobody can put a speed-breaker in the development works being carried out in the state by the three ruling parties of the Mahayuti government.


Speaking to reporters at Kashigaon, around 20 km from Thane city, he said the Kashigaon-Dahisar metro line is in the final stages of technical testing and will soon be opened to passengers, offering a significant boost to decongesting the Western Express Highway and providing much-needed relief to commuters.


Replying to a question about the Mahayuti allies, he said, "All three parties are together and we are running the state's development express in a speedy manner. No no one can put a speed-breaker in it. If they (opposition) want to give a booster, it is a different thing. There is no room for a speed-breaker here."


Describing metro rail as the "best medium" for urban transport, the CM said, "We have earlier started a few lines up to Andheri, and the launch of this phase will bring a much-need relief to commuters."

He emphasized the goal of achieving "seamless connectivity" along the Western Express Highway, from NS Bose Maidan to Bandra, with work progressing in various phases.


"The good thing about this project is that for the first time in the Mumbai Metropolitan Region (MMR) a double-decker bridge is also being constructed in this phase. This innovative design will be particularly crucial for decongesting areas like Mira Bhayandar," he said.


Ambitious plans

The CM outlined ambitious plans for further expansion and said, "Soon, travel by metro up to Virar will be possible."


He stressed the importance of integrating various metro rail lines so that people get an end-to-end solution through this medium.


Lauding the Mumbai Metropolitan Region Development Authority (MMRDA) for initiating the project, the CM pledged to accelerate the pace of work.


"Henceforth, we will work with extra speed. This year 50 kilometres and next year 62 kilometres - we have decided to carry out works in such phases," he said.

He said his government was committed to completing the metro network works initiated since 2015.


"The major network which we started will be completed by the end of 2027. This is our aim, due to which people in Mumbai and the MMR will be most benefited for travel," he said.


A bullet train station is coming up near Vadhvan (in Palghar), Fadnavis said.

"We will be required to ensure integration with it. Planning in this regard is underway," he said.


Deputy Chief Minister Eknath Shinde and Ajit Pawar, along with Transport Minister Pratap Sarnaik were present on the occasion.

 

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