Residential Real Estate Set to Dominate 70% Market Share by 2026 as Premium Housing Demand Soars

Industry experts predict that India's residential real estate segment is positioned to capture approximately 70% of the total real estate market by 2026, fueled by sustained demand and rising buyer confidence across major metropolitan areas.

Premium Housing Drives Market Growth in Tier-1 Cities

Market analysts reported that tier-1 cities witnessed residential sales worth ₹3.6 lakh crore during the first half of 2025, despite experiencing a 4% decline in unit sales volumes. Industry observers noted that the average ticket size surged by 14% to reach ₹1.42 crore, indicating a distinct consumer preference toward premium residential properties.

Real estate experts highlighted that this shift toward higher-value properties aligns with broader trends seen in top real estate hotspots across India, where premium housing segments continue to outperform affordable housing categories.

Delhi NCR and Mumbai Lead Luxury Housing Revolution

Market research revealed that the Delhi NCR region secured a 26% share in overall sales, with properties priced above ₹3 crore accounting for 73% of the region's revenue. Similarly, Mumbai maintained its position as a luxury housing hub, while southern cities demonstrated moderate growth patterns.

Property consultants observed that Chennai recorded a 23% growth rate, while Bengaluru showed a modest 4% increase. Eastern markets, particularly Kolkata, exhibited notable momentum with the luxury segment doubling its market share, while Ahmedabad also demonstrated strong performance indicators.

This trend mirrors developments in specific luxury markets, as evidenced by recent Mumbai's high-end market performance and the growing interest in luxury farmhouse investments across the NCR region.

Market Sentiment Reaches Multi-Year Highs

Industry surveys indicated that confidence levels among both homebuyers and developers improved significantly during the reporting period. The Sentiment Index increased to 56 from the previous quarter's 54, while the Future Outlook indicator climbed to 61 from 56.

Developer confidence experienced a substantial boost, primarily attributed to improved financing conditions and cumulative repo rate reductions totaling 100 basis points. Market participants expressed robust expectations for stable or higher property prices, with 94% of respondents anticipating no price declines in the near term.

Comprehensive Market Performance Overview

Strategic Implications for Property Investors

Real estate analysts emphasized that the convergence of premium buying trends, favorable financing conditions, and developer optimism is fundamentally restructuring India's property market hierarchy. As residential demand intensifies, particularly in high-value tier-1 city locations, housing emerges as the primary driver of sectoral growth.

Investment advisors suggested that potential buyers explore opportunities in emerging markets while maintaining focus on established luxury corridors. The current market dynamics present favorable conditions for investors seeking maximum rental returns in Delhi-NCR and other premium metropolitan markets.

Industry professionals recommended that stakeholders monitor developments in best cities to buy property as market fundamentals continue to strengthen across residential segments.