New Delhi, Aug 29 India's residential market has been picking up the momentum in the past two months (June-July) after witnessing an overall decline in the first quarter of FY26, a report said on Friday.
"Value growth was strong in June 2025, primarily driven by realisation and premium mix, with growth continuing in July (30 per cent year-on-year) -- in value and volume," HSBC Global Investment Research said, citing PropEquity's report.
While it is important to acknowledge the low base from last year's election impact, July saw the highest area sales (for the month) of the past 15 years, partly supported by launches during Q1, the report stated.
According to the report, this could be an early sign of broad market momentum after a decline in FY25.
Premium, large-sized and multi-bedroom apartments remained dominant, driving sales, but super luxury saw some weakness.
According to the report, 3-4 BHK apartments now constitute 70 per cent of value sold, and continued to see growth last quarter.
In terms of value, premium apartments were 67 per cent of value sold in Q1 compared to 59 per cent in FY25.
"Even in terms of area, they now constitute 51 per cent of the overall market. This is the key segment for our listed real estate developers coverage," the report stated.
From a market perspective, average realisation and average size of apartments sold remain strong and close to all-time highs.
Within markets, NCR and Bengaluru witnessed strong growth in absorption.
NCR maintained momentum, with Gurugram continuing to make new highs in volumes sold (for the past three months), surpassing the highs of 2011-13, the report highlighted.
Bengaluru and Mumbai Metropolitan Region (MMR) are also seeing highest highest-ever area sold (for July) after a tepid FY25.
Decline in Hyderabad is also reversing after a very weak year, although this is partly on account of a low base.
"In terms of the nature of demand for cities, 90 per cent of total absorption in NCR and Hyderabad is now 3BHK and above, while in Bangalore this category comprises 80 per cent," the report stated.
Interestingly, NCR is the only market where products of all sizes saw demand grow during Q1.
MMR remains the most balanced market, with 3-4BHK comprising 48 per cent of total absorption for Q1FY26, while we note this is a high for the city in the category, according to the report.
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