Kashmir Property Market Crashes After Pahalgam Attack, Prices Drop 30%

Kashmir’s property market, once buoyed by tourism and optimism, has suffered a severe downturn, with experts indicating it may be facing its most difficult phase in years. Property values across the Valley have dropped by up to 30%, converting the market into a buyer-dominated space with sellers under immense pressure to reduce prices.

Terror Attack Triggers Collapse in Buyer Confidence

The April 22 terrorist attack in Pahalgam that claimed 26 lives has been cited as a major catalyst in the market’s downfall. Real estate experts have described it as a "knockout blow" to an already fragile sector. In the weeks since, market activity has nosedived, with many deals stalling and previously hot properties receiving minimal attention.

Steepest Decline in Property Values Seen in Years

Property rates that once stood at ₹1 crore are now being offered as low as ₹70 lakh. Agents across areas like Soura reported that listings which earlier sold within weeks are now seeing no interest for months. One such consultant noted facing a 30% value erosion on a house he had purchased with minimal expected margins.

Tourism Slump Adds to the Gloom

Tourism, which traditionally drives real estate optimism in Kashmir, has witnessed a 90% decline in bookings after the attack. This sharp drop has had a cascading impact on the economy, hitting real estate particularly hard and magnifying an already stagnant market condition that had persisted for the last five years.

Luxury Properties Hit the Hardest

Analysts pointed to a widening gap in buyer preferences. Properties priced over ₹1 crore are seeing minimal interest, while smaller, affordable homes under ₹1 million are witnessing a surprising surge in demand. This shift has created a dual-speed market, where lower-priced inventory continues to move while premium listings gather dust.

Construction Activities Stalled Across the Valley

Developers, citing unpredictability and waning demand, have put many housing projects on indefinite hold. Several realtors confirmed the suspension of large-scale developments, choosing instead to focus on survival strategies and safeguarding jobs. The resulting construction halt poses further risks to employment and economic momentum in the region.

A Sector in Uncertainty

The market, once a seller’s stronghold, has swiftly transitioned into a domain of deep buyer hesitation. Stakeholders are now contending with significant paper losses, and developers are reassessing future investment moves. However, some remain cautiously optimistic, hoping that enhanced security and strategic policy support could revive the sector over time.

Disclaimer: This article is based on current news reports and expert insights as of May 2025. Real estate conditions are subject to change based on multiple socio-political and economic factors. Readers are advised to consult professionals before making investment decisions.