India's unsold housing inventory rose to approximately 18 months in the first quarter of calendar year 2026, up from around 14 months in CY24, as residential supply continued to outpace demand, according to a report by Anand Rathi. The metric, measured in "months of sales," indicates the time required to sell available stock at the current sales pace.
Rising Inventory Levels
The report attributed the supply glut to high residential launches driven by easy funding availability, capital-light land deals, and optimism from the previous growth cycle. "Despite residential decline in volume with units falling from ~4.8 lakh units in CY23 to ~4 lakh units in CY25, residential value grew from ₹4,870 bn to ₹6,006 bn during same period, revealing a clear value-volume dichotomy," the report noted. Housing sales moderated at a negative compound annual growth rate (CAGR) of around 9% over the same period.
The slowdown stems from a high base effect, affordability pressures, disruptions in the IT sector, and wealth erosion following stock market corrections, according to Anand Rathi. However, the report added that the current trend represents a volume correction rather than a structural weakness in demand.
Segment-Wise Volume Contraction
A segment-wise analysis revealed distinct patterns across price brackets:
| Segment | Price Range | Key Trends | Latest Data |
|---|---|---|---|
| Affordable & Lower Mid-Income | Below ₹80 lakh | First to face pressure; growth slowed to ~3% YoY in CY23, then declined sharply in CY24 and CY25 | NCR, Bengaluru, Hyderabad declines; MMR positive 35% |
| Mid-Income | ₹80 lakh – ₹1.5 crore | Growth slowed to ~1% in CY24, contracted ~8% in CY25 | Pan-India volume down 28% YoY in CY25; Chennai grew 23% |
| Premium | Above ₹1.5 crore | Remained relatively resilient but growth slowed to ~6% YoY in CY25 | MMR declined ~15% in both CY24 & CY25; Hyderabad -7% |
The report noted that the mid-income segment had recorded strong growth of about 92% YoY in CY23 but weakened sharply in CY24 as key markets like NCR, Hyderabad, Bengaluru, and MMR moved into contraction. Premium housing growth eased from around 149% in CY22 to nearly 86% in CY23 and about 17% in CY24.
Regional Disparities
Stress widened across markets in CY24 and deepened further in CY25, with all major micro-markets entering contraction territory. "Pan-India volume consequently declined 28% y/y in CY25, with Hyderabad (57%) and NCR (~34%) recording the steepest falls," the report added. Chennai was the only major market to post growth in the mid-income segment, rising 23% in CY25. Among premium markets, NCR and Bengaluru continued to lead but growth moderated significantly from earlier highs.
Outlook
The Anand Rathi report indicates that while the value-volume dichotomy persists, the volume correction is likely to continue until affordability improves and external shocks subside. The findings underscore a cautious near-term outlook for residential real estate, with developers expected to moderate new launches in response to rising inventory.
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