In the first quarter of 2026, housing sales across India's seven largest cities experienced a notable decline, falling 7% quarter-on-quarter to reach 101,675 units, valued at approximately Rs 1.51 lakh crore. This decrease contrasts with the previous quarter's sales of 108,970 units, which had a value of Rs 1.60 lakh crore, according to data from property consultant Anarock. The ongoing conflict in West Asia, particularly the war in Iran, has significantly influenced market dynamics, leading to increased uncertainty among potential homebuyers, especially those from the Middle East, who are key investors in Indian real estate.
Anuj Puri, Chairman of Anarock Group, highlighted that while the long-term outlook for India’s residential market remains robust, the immediate effects of geopolitical tensions are evident. He pointed out that the decline in sales reflects a broader sentiment shift driven by rising oil and construction costs, particularly noticeable in March. The pause in investment activity from many prospective Middle Eastern buyers underlines the impact of regional instability on Indian real estate, as these investors typically contribute a significant share of funding in this sector.
Despite the quarter-on-quarter decrease, the overall annual performance demonstrates a 7% increase in sales compared to the same period last year, where 93,280 units worth Rs 1.42 lakh crore were sold in Q1 2025. This indicates that while the immediate outlook may seem concerning, the underlying demand remains relatively strong. The value of housing sales has seen a slight decline of 5% on a quarterly basis, but an annual increase of 6% indicates a resilient market moving forward.
In terms of city performance, the Mumbai Metropolitan Region (MMR) and Bengaluru combined accounted for nearly 48% of total sales in the first quarter. Notably, Chennai experienced the most significant quarterly drop in housing sales at 18%, yet it also achieved the highest year-on-year growth at 31%. This mixed performance across different cities emphasizes the varying local factors that can influence real estate trends, underscoring the nuanced nature of the market amid broader geopolitical challenges.