India is seeing a major shift in home-buying preferences, and there’s a consistent decline in demand for sub-₹1 crore homes as buyers aim for better amenities and facilities. Growing interest in high-end and premium residential developments has resulted in more developers focusing on premium homes, those priced between ₹1.5- 3.0 crore. Numbers back this claim. Apartments priced at ₹1 crore and above accounted for  62% of total sales in the first nine months of 2025, up from 52% in the same period of 2024, and the segment that stood out was the ₹1.5- 3.0 crore segment that grew 10% YoY, but mass housing market (sub-₹1 crore home sales) saw a significant 30% YoY decline.

While premium homes gained market share in January to September 2025 sales, the mass segment’s (sub-₹1 crore) share dropped from 48% to 38%YoY, per the JLL data. While total residential sales fell 12% Y-o-Y to 202,756 units in January-September 2025, premium homes valued at ₹1 crore and above posted 4% growth over the same period. This is especially evident in the ₹1.5-3.0 crore category, which saw demand increase by approximately 10% compared to January-September 2024.

Gurugram leads NCR’s premium housing boom

Delhi-NCR, along with Mumbai, are the two undisputed leaders in luxury and premium real estate space in India, with both catering to an increasing number of affluent buyers, who look at premium and luxury properties from both investment as well as personal use-case points of view. Within Delhi-NCR, Gurugram has emerged as the epicentre of this shift, driven by expressway connectivity, proximity to corporate hubs, and rising demand from HNIs, NRIs, and senior professionals.

“Buyers today prioritise thoughtful design, curated communities, and experiential amenities ranging from wellness-focused spaces to high-quality architecture inspired by global aesthetics,” says Rishi Raj, CEO, Conscient Infrastructure.

Over the past few years, the centre of gravity in NCR real estate has decisively shifted towards Gurugram. Nearly 60% of NCR’s new residential launches this year are priced above ₹2.5 crore, with Gurugram accounting for the lion’s share. 

“Golf Course Road, Golf Course Extension Road, and Dwarka Expressway have emerged as the new urban core of aspirational living. With over 8 million sq. ft. of active office leasing by global corporates, job creation is increasingly concentrated here,” says Manik Malik, CEO, BPTP.

Reasons behind NCR's rise as a hub for luxury housing are evident. Being India’s leading metropolitan region, it offers a cosmopolitan cultural mix and, as the nation’s political capital, hosts the headquarters of several top industries, multinationals, and policy institutions, making it both economically and socially attractive for high-end homebuyers, say industry watchers. Due to its proximity to Delhi, Gurugram also contributes a substantial share to NCR’s high-net-worth individual base. “Gurgaon’s growing wealth base, aspirational homebuyers, and expanding lifestyle ecosystem have together positioned it as the epicentre of Delhi-NCR’s luxury housing momentum,” says Shveta Jain, Managing Director & Head - Residential Services, Savills India, a leading real estate consultancy offering advisory, valuation, and transaction services across residential, commercial, and industrial sectors.

Rajat Khandelwal, Group CEO, Tribeca Developers, echoes a similar sentiment, saying the luxury housing wave in Delhi-NCR is the result of a deeper structural transformation. “Over the past few years, Gurugram has evolved into a magnet for professionals and entrepreneurs. This has fuelled demand for larger, smarter, and more refined living spaces that align with global benchmarks of luxury.” Tribeca Developers’ Trump Residences in Gurugram is one such example, which sold out within hours of its launch on May 13, 2025. “Such projects resonate strongly with a new generation of buyers seeking exclusivity, privacy, and lasting asset value,” says Khandelwal.

The Indian housing market is witnessing a structural shift from volume to value-led growth. ANAROCK data shows the overall housing sales value in FY26 may rise by nearly 19% year-on-year to over ₹6.65 lakh crore, even as volumes remain flat. This reflects the growing demand for luxury and ultra-luxury homes, which accounted for 42% of new supply in H1 FY26. “Buyers today are seeking premium developments offering superior design, amenities, and brand assurance, rather than just space. Developers are aligning with this sentiment by launching curated, high-end projects across major cities,” opines Robin Mangla, President, M3M India.

Mumbai’s shift towards bigger, better spaces

After NCR, the Mumbai real estate market also continues its upward trajectory, with 2025 setting new benchmarks in both property registrations and government revenues. Between January and September 2025, 1,11,388 property registrations were recorded — the highest in the past seven years, as per ANAROCK data. This marks a 5.5% increase over 2024 (1,05,607 registrations) and an 18.1% rise over 2023 (94,307 registrations), reinforcing the sustained strength of buyer demand. 

Not only just the ₹1-3.5 crore segment, Mumbai is also a leader in the ₹10 crore + segment, with its ultra-luxury market setting a new benchmark in the first half of 2025 by recording the highest-ever half-yearly (H1 CY’25) sales of ₹14,750 crore.

Vikram Mehta, founder of Meson Group, a Mumbai-based real-estate developer and structural engineering consultancy, lists out some key basic reasons as to why urban India is consistently moving away from the sub-₹1 crore segment in Mumbai. Some of them are an increasing number of women contributing to the family’s earnings, people’s confidence in the Indian economy, which is thriving. “People have confidence in spending money as they know they will be able to earn in the days to come also. That insecurity is gone.”

Mehta, whose company has overseen numerous residential, commercial and hospitality projects in Mumbai, believes people’s perception of home has changed now, and there’s a shift regarding spacious homes post-COVID. “The tendency earlier was that if we can manage with a one-bedroom, why spend today for a two-bedroom. That concept has changed. A lot of people work from home, students have online classes, and even homemakers have online, for example, yoga sessions. That creates the need for a larger space.”

The increasing need of affluent Indians for societies that offer larger podium spaces, parking, and amenities such as pickleball courts has also contributed to the growth of this particular segment. “Around ₹2 crore to ₹2.5 crore is a sweet spot for a lot of higher-middle-class buyers,” says Mehta.

Sujay Kalele, Founder and CEO, TRU Realty, a Mumbai-based premium residential developer, echoes the similar views. He says the current generation isn’t buying homes merely for ownership but to enhance the quality of life. “The ₹1.5-3 crore bracket delivers quality, location, and resale strength without entering speculative luxury. This balance between emotional fulfilment and rational value is what’s truly driving the surge in Mumbai’s premium housing market today.

On whether developers are repositioning to cater to this mid-income segment, Mehta believes such a demand is primarily coming from the Mumbai suburbs (the northern suburbs), because this ticket size is achievable there. “Developers are focusing more on cluster redevelopment—the redevelopment of larger groups of societies—since empty land in Mumbai is no longer available. Developers are giving more incentives to existing members if they amalgamate or do a joint development with adjacent buildings, which gives them the freedom to plan infrastructure in a much better way.”

Kalele of TRU Realty believes that in Mumbai, where space is always scarce, the real luxury now lies in trust, good design, and the everyday experience of living well. “As developers, we have repositioned our projects to reflect this shift. We are re-engineering layouts for better ventilation, optimising common areas, and integrating wellness without inflating prices.”

Are developers overlooking affordable segments? 

While premium housing saw strong demand in Jan-Sept 2025, developers were cautious with new mid-range and affordable launches, where demand has been sluggish over the last few quarters, stated the JLL report. This begs the question of whether developers are intentionally overlooking affordable segments to cater to premium and luxury buyers because of better margins attached to such projects.

While strong underlying drivers continue to power demand in cities in Gurugram, developers feel the product mix is expected to gradually rebalance. “The ₹3–5 crore segment, in particular, is emerging as a sweet spot, offering broader accessibility without compromising on aspiration,” says Conscient’s Raj. The company has launched two key projects, PARQ and Elaira Residences, in the Sector-80 micro market of Gurugram, and is also planning new launches in its micro-market.

BPTP’s Malik opines that while premium and luxury dominate these urban hubs, developers are not overlooking other segments. “The current cycle reflects a rebalanced strategy, where developers are aligning supply with real demand, location economics, and maturing consumer preferences,” adds Malik.

Analysts also agree that developers are not deprioritising mid-income and affordable housing; it’s that they are catering to the demand, the bulk of which, particularly from first-time homebuyers, is coming from the mid-income segment. “What may appear as a slowdown is largely a function of rising input costs and escalating property prices, which have created a temporary mismatch between demand and available supply. Developers remain cognisant of this demand base and are likely to calibrate launches accordingly.”

Rajat Khandelwal, Group CEO of Tribeca Developers, says that while the mid and affordable segments continue to evolve at their own pace, rising disposable incomes and aspirational lifestyles are the reasons that Delhi-NCR’s housing market is steering towards the luxury spectrum.