Home prices in 2026: What happened in 2025 and what it means for homebuyers going into New Year

Even as overall housing sales across the top seven cities in India declined in 2025 compared to 2024, the year witnessed an average 8% increase in prices, from ₹8,590 per sqft at the end of Q4 2024 to around ₹9,260 per sqft in Q4 2025, according to Anarock Research.

As we prepare to welcome the New Year 2026, this article looks back at what happened in 2025 with respect to property prices and sales and what they mean for homebuyers going forward in 2026.

What happened in 2025

First, housing sales declined across cities in 2025 even as the Reserve Bank of India (RBI) cut the repo rate by 1.25 basis points during the year. Interestingly, the repo rate cut or the declining housing sales didn't result in a fall in property prices. However, Chennai was an exception where sales jumped by 15% in 2025.

Data from Anarock Research shows that approximately 3,95,625 housing units worth over ₹6 lakh crore were sold in 2025 in the top 7 cities, against 4,59,645 units worth more than ₹5.68 lakh crore in 2024.

Hyderabad witnessed the steepest 23% decline in housing sales, followed by Pune and Mumbai Metropolitan Region (MMR). Bengaluru and Delhi-NCR witnessed the lowest fall in sales.

Second, housing prices increased across cities, with Delhi-NCR witnessing the highest yearly average residential price rise of 23% in 2025 compared to 2024.

"On an annual basis, the collective average housing price rose by 8% in the top 7 cities - from ₹8,590/sq. ft. by Q4 2024-end to around ₹9,260/sq. ft. at Q4 2025-end. At 23%, Delhi-NCR recorded the highest yearly average residential price rise – from ₹7,550/sq. ft. in 2024 to about ₹9,300/sq. ft. in 2025. The other major cities recorded single-digit price appreciation, ranging between 4-9% in 2025 as against last year’s 13-27% in 2024," Anarock Research said.

Third, new launches moderated across cities. Hyderabad witnessed a 26% decline in new launches.

Approx. 4,19,170 new units were launched in 2025, which is 2% lower than 4,12,520 units in 2024. The key cities contributing to new supply during the year were MMR, Pune, Bengaluru, and NCR.

Fourth, new houses are getting bigger and better but costlier. The share of new supply of homes priced over ₹2.5 crore in the top 7 cities was 21% in 2025, compared to 18% in 2024.

For instance, over 72% of the new supply in MMR was in the sub-₹1.5 crore budget segment in MMR in 2025. In Bengaluru, 79% of the new supply was in the ₹75 lakh-₹2.5 crore budget segment.

In Pune, over 86% of the new supply was in the sub-₹1.5 crore budget segment. In NCR, over 55% of the new supply was in the luxury and ultra-luxury segment priced over ₹2.5 crore. Similarly, in Hyderabad over 65% of the new supply was in the sub-₹2.5 crore budget segment.

In Chennai, over 71% of the new supply was in the sub-₹2.5 crore budget segment. Kolkata had approx. 87% of the new supply in the sub-₹1.5 crore budget segment.

What do the above trends mean for homebuyers in 2026?

Going forward, the RBI is expected to further reduce the repo rates. While this may make home loans more affordable, homes themselves are not likely to become more affordable in 2026.

Falling housing sales in 2025 may be attributed to elevated prices, a lower increase in individual incomes, or too much supply than demand. If the sales continue to fall in 2026, we may see a higher demand for existing properties among rental consumers, which will eventually result in increasing rents in the top seven cities.

However, multiple factors such as tax cuts, lower home loan rates, and employment-generating investments across cities in 2025 may increase demand for new homes in the New Year. But one can't be sure about it until buyers' incomes also increase.

Further, the demand for better and bigger homes is expected to continue in 2026. However, this also means that buyers will have to spend more to own their dream homes in 2026.