India housing demand stays strong despite weak real estate stocks: Nomura

India’s listed real estate developers are expected to post steady home sales for the third quarter in a row, even as real estate stocks remain under pressure, according to a latest note by Japanese brokerage firm Nomura. The brokerage said housing demand in India continues to remain strong, and recent stock price weakness is mainly due to broader market conditions.

Nomura said demand for branded residential projects is healthy across cities and price segments. In many cases, developers are facing challenges related to limited supply and delayed approvals rather than a shortage of buyers. The brokerage maintained a positive view on the sector and named Prestige Estates as its top pick, while also favouring Lodha Developers and Aditya Birla Real Estate (ABREL).

Demand remains firm, supply is the main challenge

Nomura expects developers to deliver a third consecutive quarter of resilient pre-sales in Q3FY26. It said sales from both new launches and existing projects have largely remained stable compared with the previous quarter. This shows that end-user demand for homes has not weakened.

However, the pace of new project launches has been uneven. Developers such as Sobha launched multiple projects during the quarter, while others like DLF and Oberoi Realty did not introduce new developments. Nomura pointed out that delays in regulatory approvals have pushed some launches into later quarters. These delays may affect when revenues are booked, but they do not signal a fall in demand.

New models experience positive response

Nomura emphasised that there is good demand being witnessed in new residential properties in the super-luxury, luxury, premium, and mid segments. Super-luxury properties ranging between ₹4 crores to ₹17 crores in Mumbai, Pune, and Hyderabad have witnessed encouraging sales. Properties between ₹3 crores to ₹3.5 crores in Bengaluru, Gurugram, and NCR have also lured many customers.

Easier-to-access segments, such as homes around ₹1.5 crore in Pune, saw steady sales. Sales from established inventory were also comparable to the preceding quarter, which is a sign that buyers are active in all segments.

Outlook for the developer community is also optimistic

Among the developers, Lodha Developers is tipped to register the strongest-ever quarterly sales of around ₹5,500 crores. Godrej Properties is also set to register strong growth on the back of a number of launches in major cities. ABREL is likely to register strong growth on account of near-sales-out and a strong project pipeline. Prestige Estates is set to register healthy sales provided project approvals come on time.

Overall, Nomura said India’s residential real estate market remains on a solid footing. While short-term market volatility and approval delays may impact quarterly numbers, the medium-term outlook for top branded developers remains positive.