Mumbai, one of India's most vibrant cities, exemplifies the changing landscape of the real estate market. Sales of luxury apartments priced above ₹1 crore have surged by 6% in 2025, contrasting sharply with a 30% decline in the demand for homes priced below ₹1 crore. This shift highlights the diminishing availability of affordable housing options in top metropolitan areas, a trend that has significant implications for both buyers and developers.
According to a recent report by property consultancy JLL, only 37% of total sales in 2025 involved units priced under ₹1 crore, a notable drop from 47% the previous year. Meanwhile, properties valued at ₹1 crore and above now represent 63% of the market share, up from 53% in 2024. The report indicates that weakened sales in the middle-class segment have contributed to an 11% decline in overall sales for the year, emphasizing the growing divide in housing affordability.
The increasing preference for premium housing is largely attributed to strong demand in the ₹1.5-3 crore price segment. With rising land prices and construction costs limiting the feasibility of developing affordable units, developers are increasingly focusing on high-margin projects. This trend is evident in the launch statistics, where premium segment launches continued to attract significant interest despite an overall decline of 3% in new project launches. Notably, Calcutta recorded a 61% increase in launches, totaling 17,164 units, primarily due to a favorable base effect.
Samantak Das, Chief Economist and Head of Research at JLL India, has pointed out that the residential market is undergoing a premiumisation shift, which reflects buyers' growing preference for large gated communities that offer enhanced amenities. This trend is not solely driven by rising income inequalities; rather, it signifies a broader change in consumer priorities in urban living. Even amidst an 11% drop in total pan-India sales, the sales value has impressively climbed by 11% year-on-year to ₹5,57,100 crore, underlining the robust appetite for premium properties.
As the real estate market evolves, it is clear that the demand for affordable housing is waning, creating a stark divide between luxury and budget-friendly offerings. This trend poses challenges for middle-class families seeking homeownership, while simultaneously presenting opportunities for developers to cater to the affluent segment. The implications of this shift will continue to shape the landscape of urban housing in India, as cities like Mumbai, Delhi, and Bangalore adapt to these changing dynamics.