New Delhi, Dec. 30 -- India's $500-billion real estate market recorded its second straight annual drop in new home sales volume in 2025 as high prices continued to erode affordability. With sales volumes down 14% this year, following a 4% dip in 2024, real estate developers are now banking on a mix of lower mortgage rates, resilient GDP growth, and possible tax relief in the upcoming Union Budget to revive demand for residential properties in 2026 and restore confidence in the sector. Builders, however, found some comfort in value-wise growth of new home sales, driven by steep price appreciation in the post-pandemic housing cycle and a deliberate shift by builders toward luxury residences in pursuit of better profit margins. The divergence signals a deepening split in buyer behaviour: while premium homes continue to attract ultra-rich investors and aspirational buyers, the entry-level and mid-income segmentsctraditionally the backbone of urban housing-remain under pressure. Leading real estate consultant Anarock data showed that housing sales across seven major cities fell 14% to nearly 5.96 lakh units this year, while sales bookings value rose 6% to Rs.6 lakh crore. "2025 has just been one of those wild years, with geopolitical drama everywhere, layoffs hitting the IT world hard, no end to the tariff debate-all sorts of curve-balls keeping the market on edge," Anarock chairman Anuj Puri said. "One interesting shift was that the sky-high double-digit price jumps from past years cooled off to single digits this year," he observed. Realtors apex body CREDAI National president Shekhar Patel said housing demand remained resilient despite global volatility. The consolidation of housing demand towards big branded developers, a trend that kicked in few years back, gained further momentum during 2025. Led by Godrej Properties, DLF, Prestige Group, Lodha Developers, and Signature Global, India's top-28 listed realty firms clocked sales bookings of Rs.92,500 crore during April-September period, FY26. Luxury housing continued its growth trajectory while the share of affordable homes in sales and launches slipped. Builders blame high land prices for their inability to develop inventories for masses, termed as affordable and mid-income housing categories. Limited supply of units under Rs.1 crore is a factor that dragged overall sale volumes this year.Unlike the housing vertical, India's commercial real estate performed exceptionally well with bumper leasing of office, retail and warehousing spaces. As a result, Indian real estate attracted record institutional investments this year at $10.4 billion, 17% rise year-on-year, JLL data showed. Domestic and foreign investors pumped money in the property market, anticipating better return. India's office market, which is witnessing a V-shaped recovery post- pandemic, got maximum 58% of the institutional investments. Foreign firms looking to establish global capability centres are driving demand for conventional and managed office space in India, which offers skilled human resources as well as prime workspaces at a monthly average rent of just $1 per sq. ft across major cities. Leasing of industrial and warehousing spaces also grew to an all-time high across top tier-I, tier-II and tier-III cities on better demand from companies engaged in light manufacturing activities, third party logistic players and e-commerce firms....