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India's real estate market continues to demonstrate cautious optimism, as revealed in the latest Real Estate Sentiment Index by Knight Frank and NAREDCO. Although both current and future sentiment scores dipped marginally in Q1 2025 compared to the previous quarter, the industry remains in the positive zone. While developers and financial institutions foresee stability or growth in residential prices and project launches, global uncertainties have slightly tempered expectations regarding sales. Nevertheless, the sector remains resilient and focused on long-term momentum amid a dynamic global economic backdrop.
Real estate developers and financial institutions have conveyed cautious optimism regarding short-term prospects in India's property sector, despite being wary of prevailing global economic uncertainties. This outlook was shared in the latest Real Estate Sentiment Index, jointly released by real estate consultancy Knight Frank and industry body NAREDCO. Advertisement
The index for the first quarter of 2025, covering the period from January to March, reflected what Knight Frank described as a "cautiously optimistic mood among real estate stakeholders." The Current Sentiment Score dipped marginally to 54 from 59 reported during the last quarter of 2024. Similarly, the Future Sentiment Score softened to 56, down from 59 previously.
As per the index, a score of 50 denotes a neutral stance. Scores above 50 signal a positive outlook, while those below 50 suggest pessimism.
Knight Frank commented earlier this week that while both scores remain in optimistic territory, the drop points to increasing caution among stakeholders due to factors such as global trade frictions, ongoing economic adjustments, and geopolitical volatility across regions.
During the first quarter of this year, around 93 per cent of participating developers and financial institutions indicated that residential prices were either expected to stay steady or see growth. In terms of new launches, 67 per cent of respondents expressed expectations of either stability or an upward trend.
However, sentiment surrounding residential sales appeared to cool. Only 50 per cent of stakeholders believed sales would either improve or hold steady, a notable decline from the 88 per cent optimism seen during the same period last year.
NAREDCO President Hari Babu observed that although both current and future sentiment scores recorded a marginal decline from the previous quarter, this modest drop despite prevailing global uncertainty reflected the underlying resilience and adaptability of India's real estate sector. He noted that the industry continues to push forward with confidence and a long-term strategic outlook.
The slight dip in sentiment does not suggest retreat but rather a recalibrated forward view, underscoring the maturity of market players. As the sector navigates these fluctuations, its adaptability and continued belief in long-term fundamentals remain central to its growth trajectory.
Source - PTI
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