Indian economy remains resilience despite volatile global environment

The Indian economy continues to remain resilient in the backdrop of a volatile global environment.

The stable economic backdrop, with lower inflation and the repo rate have played their role in supporting sentiments in the residential market.

87,603 units were sold in Q3 2025, marginally higher by 1 per cent YoY and in YTD terms (Jan-Sept 2025), the sales volumes were 1 per cent lower than the base period last year.

Interestingly, sales have remained stable or grown marginally across all markets with the exception of Pune which witnessed a decline of 8 per cent YoY in Q3. The highest sales volumes were recorded in Mumbai at 24,706 units, 2 per cent higher in YoY terms.

At 12 per cent YoY, sales grew the most in the Chennai market to 4,617 units, the highest seen since the pandemic, according to Knight Frank India’s Q3 India Real Estate report.

The steady growth in demand was surpassed by the volume of units launched, exceeding sales for the past 12 quarters. 88,655 units were launched in Q3 2025 which constitutes a 2 per cent drop over the previous period. The Chennai and Bengaluru markets saw the highest growth in units launched during the quarter at 44% and 28% YoY respectively.

Mumbai and NCR saw a significant drop in the volume of units launched at 19% YoY each and were instrumental in limiting the overall tally during the quarter. While price growth has sustained, developers have increasingly begun to offer financing options such as bank and developer subvention schemes in order to push sales.

Market activity continues to be concentrated at the top end of the market while momentum continues to slide in ticket sizes under INR 10 million. The share of these lower segments now constitutes 48% of the total sales compared to 54% in Q3 2024. Kolkata is the only market which has seen sales grow in the INR 5 million and INR 5-10 million segments.

Sales of units priced over INR 10 million have grown by 13 per cent YoY compared to the 16% and 5% YoY degrowth in the INR in the INR 5 million and INR 5-10 million segments. This growth in sales is apparent in most of the ticket sizes above INR 10 million with the largest segment of INR 10-20 million growing by 17% YoY while the INR 50-100 million, INR 100-200 million and INR 200-500 million segments have seen sales grow by 33%, 170% and 34% YoY respectively. Sales in the INR 10-20 million segment constituted 28% of the total volume, marginally exceeding the volumes accounted for by the INR 5-10 million segment which has largely held the highest market share since Q4 2022.

While the overall sales growth has plateaued, the unsold inventory has consistently increased since 2020 as supply levels have exceeded sales. For the eight key markets, the quarter to sell indicator (QTS) throughout the past year has held at close to 5.8 quarters, equivalent to less than 18 months. This stability, despite an uptick in inventory, underscores the resilience of market fundamentals.

Price growth has been healthy in Q3 2025 despite overall sales not seeing any growth.

The price growth has been strong in NCR, Bengaluru and Hyderabad at 19%, 15% and 13% YoY respectively.

In the meantime, institutional investments in the Indian real estate sector stood at USD 4.3 billion during the first nine months of 2025, marking a 9% year-on-year decline. This in a way reflects the cautious investor approach amidst prevailing global headwinds, trade frictions and other external volatilities. However, despite the annual dip, nine-months investment volumes remained above the average of $4 billion inflows in the January-September period of last five years. The trend underscores ongoing investor confidence in the fundamentals of Indian economy and real estate market, says Collier’s survey.

My mother invested in land in 2018 and I inherited the property. I built a house in 2023 and now want to sell it. What are the tax implications on sale now? Shailaja, Sharjah.

The holding periods and acquisition costs have to be determined separately. As the land was bought in 2018, it is a long-term asset and your mother’s holding is included in yours. It is not clear which month in 2023 the house was built.

If it is less than 24 months, it is a short-term capital asset. While construction costs will be deductible, no indexation is allowed.

My relative wants to gift an immovable property located in Pune? Does it require compulsory registration? Sunil Almeida, Dubai

A gift of immovable property is legally valid only if it is made through a registered gift deed. It should be accompanied with a registered gift deed. Then only you will get the legal ownership of the property and right to possession of such property.