India’s residential real estate market is gearing up for a strong rebound in 2025, powered by the Reserve Bank of India’s (RBI) recent 50 basis points (bps) repo rate cut. This move marks a total of 100 bps reduction this year, signaling a favorable climate for homebuyers—especially in the ₹2–5 crore segment, which is gaining momentum among aspirational and upgrade-seeking buyers.
With home loan interest rates expected to dip below 8%, affordability is set to improve significantly. Market analysts, including ANAROCK, highlight that premium homes (₹1.5–3.5 crore) have seen growing demand, constituting nearly 25% of housing sales in top 7 Indian cities in Q1 2025—up from 18% two years ago. Notably, the ₹2–5 crore range has become the fastest-growing housing price bracket.
Signature Global’s Co-Founder & MD, Mr. Ravi Aggarwal, emphasized that this move by the RBI is crucial for the mid-premium market. As financial confidence grows and developers enhance offerings with better connectivity, amenities, and flexible payment plans, a sharp increase in walk-ins and sales closures is expected in hotspots like Gurugram (Dwarka Expressway, SPR), Thane, Powai, North Bengaluru, Pune, and Hyderabad.
Developers are aligning with buyer expectations by offering premium features such as larger layouts, green certifications, and modern facilities. The interest rate reduction could save buyers up to ₹35–40 lakh over a 20-year term on a ₹2.5 crore loan, lowering EMIs by ₹10,000–₹12,000, thus improving affordability and reducing decision timeframes.
Q1 2025 saw 1.25 lakh residential units sold across top cities—a 9% YoY increase—while new launches rose 7%, with nearly a third priced above ₹2 crore. Home loan queries surged 12% during April–May 2025, indicating a clear uptick in buyer sentiment.
With real estate’s contribution to India’s GDP expected to exceed 10% by 2030, the RBI’s rate cut could be the catalyst for a long-term housing boom—led by the mid-premium and premium home segments in urban India.
