India’s real estate sector seems to be holding its optimism even as the global economy turns unpredictable. The 46th edition of the Knight Frank–NAREDCO Sentiment Index for July to September 2025 shows that confidence among stakeholders has not only stayed intact but has strengthened. The findings offer a reassuring snapshot of a sector that has learned to navigate uncertainty without losing momentum.
The ‘Current Sentiment Score’ has climbed to 59 from 56 in the previous quarter, the highest point of the year so far. The ‘Future Sentiment Score’ remains unchanged at 61, a sign that expectations for the coming months continue to sit comfortably in the optimistic zone. Together, the two numbers signal a market buoyed by steady demand, healthy liquidity and an economic environment that has settled into a more predictable rhythm.
Much of this confidence rests on three pillars: stable interest rates, easing inflation and firm demand across the residential and office segments. Developers and investors see these conditions as strong enough to push growth forward even as the world economy remains volatile.
Parveen Jain, President of NAREDCO, believes the index reflects the sector’s underlying strength. “The Knight Frank–NAREDCO Real Estate Sentiment Index – Q3 2025 reflects steady confidence in India’s property market. Developers and investors remain optimistic, supported by stable demand, policy continuity and healthy funding conditions. Premium housing and office spaces drive growth, signalling a balanced, resilient outlook for the sector in the coming months,” he said.
The sentiment is echoed by Shishir Baijal, Chairman and Managing Director of Knight Frank India. He sees this steady upward tone as a reflection of adaptability and deep structural demand. “The sustained optimism reflected in the Q3 Sentiment Index underscores the sector’s resilience and adaptability. Both current and future sentiment scores remain comfortably in the positive zone, reaffirming confidence in India’s economic stability and long-term growth story,” he said. Baijal added that premium homes remain strong performers while the office market “continues to demonstrate structural depth with strong leasing pipelines,” supported by stable rates, easing inflation and better liquidity.
Regional sentiment trends further reinforce the picture of steadiness. The South Zone remains the most optimistic at a score of 62, even after a small one-point moderation. Bengaluru and Hyderabad continue to power this momentum with strong office leasing and high-ticket residential demand. The North Zone has inched up to 56 as the NCR office market shows firm movement. The East Zone has softened slightly to 59 because of moderated residential launches in the first three quarters of 2025. The West Zone has dipped from 61 to 59, though Mumbai and Pune’s office absorption has kept overall sentiment healthy.
Developers appear slightly more cautious this quarter. Their sentiment score has eased to 59 from 63. Higher construction costs and slower traction in mid- and low-income housing seem to be weighing on their confidence. Non-developers such as banks, private equity firms and financial institutions remain upbeat with a score of 61, indicating continued confidence in liquidity and asset quality.
The residential sector has held firm through the quarter. Developers have been selective with new launches, focusing more on high-ticket projects where demand is consistent and margins are stronger. About 71 percent of respondents expect launches to remain stable or increase. Sentiment on sales is even stronger. Seventy four percent of respondents expect sales to hold steady or improve, compared to 52 percent in the previous quarter. This shift is supported by rate cuts, subvention schemes and incentives that have improved buyer affordability.
Price expectations remain stable. A large majority—92 percent—believe prices will either hold or rise. NCR, Bengaluru and Hyderabad have shown some of the strongest year-on-year price hikes, ranging from 13 to 19 percent, driven by demand in upper-mid and premium housing.
The office market is the brightest spot in the index. Leasing sentiment has strengthened further, with respondents expecting activity to remain stable or rise over the next six months. Seventy eight percent believe new supply will remain steady or grow at a moderate pace. Developers are adopting a disciplined approach to additions, which has kept absorption high and inventory in check. With 95 percent of respondents expecting office rents to remain firm or rise, the outlook remains positive. The sector continues to draw steady interest from global capability centres, tech firms and the expanding flex-space ecosystem.
The broader economy has also played its part. Seventy eight percent of respondents expect India’s economic momentum to remain steady or improve, supported by easing inflation and ongoing fiscal spending. Funding conditions remain favourable, with 86 percent expecting liquidity to stay the same or improve further. The RBI’s accommodative stance and active capital deployment into premium housing and commercial assets have ensured that money continues to move through the sector without friction.
Taken together, the Q3 2025 Sentiment Index paints a picture of a sector that has regained its footing and is holding it well. Despite global headwinds, India’s real estate market is supported by solid fundamentals, consistent demand and policy stability. As the fourth quarter begins, the sector moves ahead with calm confidence, aware of the risks but anchored by steady growth across segments.
