Is Now the Right Time to Invest in Realty Stocks?

India's real estate sector is showing signs of recovery after a challenging year. The Nifty Realty Index experienced a 13% decline in 2025, but recent developments suggest a potential rebound. Analysts are optimistic, citing factors like festive season demand, easing interest rates, and attractive home loan offers as catalysts for this turnaround.

Festive Season Boost

The fourth quarter of the year is traditionally the strongest for real estate sales in India. Analysts estimate that between 1.35 and 1.40 lakh homes could be sold across the country during this period, accounting for 35-40% of annual residential sales. This surge is supported by strong property registration activity in key markets like Mumbai and the National Capital Region (NCR), along with the launch of new projects.

Market Dynamics Shifting

While the number of units sold has seen a modest decline, the value of home sales has risen by 14% year-on-year in the third quarter, reaching Rs 1.52 lakh crore. This indicates a shift towards premium, value-driven housing demand. Developers are responding by focusing on fewer but higher-value projects to cater to evolving buyer preferences.

Investment Opportunities

Despite the recent market correction, analysts are turning bullish on select real estate stocks with strong fundamentals and robust pipelines. For instance, Signature Global is projected to offer a 61% return over the next 12 months, followed by Brigade Enterprises at 42% and Sobha at 35%. These companies are well-positioned to benefit from the anticipated market recovery.

For investors with a medium to long-term horizon, the current dip in real estate stocks could present an opportunity to accumulate quality assets at attractive valuations. With the festive season driving demand and favorable market conditions, the sector is poised for a potential turnaround. However, it's essential to conduct thorough research and consider individual investment goals before making decisions.