Synopsis: With the Indian real estate sector shifting gears in 2025, this article explains the latest housing trends emerging in top metro cities and what they mean for future market expansion.
India’s urban housing landscape in 2025 changed a lot, which is driven by demographic shifts, evolving lifestyle preferences, sustainability imperatives, and technological advancement. This article highlights Top 9 emerging housing trends in Indian Cities in 2025
1. Premium Housing Dominates Market Share
- As rises in income lifestyles also change, India’s upper-middle class is increasingly investing in premium and luxury homes. Property prices between ₹2 to 5 crores have become the most active segment in India’s housing market.
- In the period from January to September 2025, the homes with a price tag of ₹1 crore and above contributed 62% to the total housing sales, which is a considerable rise from 52% in the corresponding period of 2024.
- On the other hand, the affordable housing segment faced a gigantic 30% decline in sales with the market share already diminishing from 48% in 2024 to 38% in 2025, which means people have started to buy more expensive houses.
2. The Rise of Tier 2 Cities as Growth Centers
- Cities such as Lucknow, Coimbatore, Surat and Bhubaneswar are enjoying tremendous growth owing to better infrastructure, smart city projects, and acceptance of remote and hybrid work modes.
- These cities present a very good opportunity as property prices are still low compared to the metros, the quality of life is better with less traffic, and the development of infrastructure is going on fast.
3. Co-Living Space
- As the market is shifting from traditional PG (Paying Guest) to Co-living space. Especially in Bengaluru, more Gen Z and millennials, the age group of 21 to 27 years, seek cheap, flexible stays, enhanced safety and premium amenities.
- The segment is projected to expand at a compound annual growth rate of 17% from 2020 to 2025, reaching a value of $40 billion by 2025.
- It starts a rental monthly range from ₹10,000 to ₹35,000, with rental arbitrage of up to 35% compared to traditional 1 BHK units. Co-living space provides comprehensive services like WIFI, housekeeping, facilities, laundry room, recreational zones, and 24/7 security.
4. Sustainability and Wellness Take Centre Stage
- People are now focusing more on health and Environmental consciousness, which are niche preferences to mainstream demand. India’s wellness real estate sector reached $13 billion in 2024, more than doubling from $6 billion in 2019. This happens after Covid people changed their lifestyle, where homes became sanctuaries for work, exercise and relaxation
- And also implement the Green building features such as solar panels, rainwater harvesting, and waste management systems. The green building market in India is expected to be $39 billion by 2025, and luxury buyers will look for properties with green certifications, resource management systems, and biophilic design elements.
5. The Integration of Smart Home Technology and Prop Tech
- The builders of smart homes are more and more selling “smart-ready” apartments, with structured cabling, Wi-Fi mesh systems, and pre-installed hubs. This makes it easy for homeowners to use devices from different brands together.
- The installation of smart lighting, climate controls, digital door locks, and energy management systems is becoming standard in the industry. The CAGR of the PropTech market in India is 13.03%. Urban population growth and demand for digital real estate solutions are the main factors contributing to this market growth.
- In the year 2023, the amount of money invested in PropTech in India was over ₹4,500 crore, and 75% of the real estate companies plan to integrate AI in 2025.
Also read: Coimbatore Emerging as South India’s New Real Estate Hotspot – Here’s Why
6. The Mid-Segment Housing is the main driver of Market Growth
- The residential real estate of India in 2025 has been supported mostly by the mid-segment housing properties, which are priced between ₹40 lakh and ₹1.5 crore, and have become the undeniable workhorse of the market.
- The demand from the middle-class is projected to be 600 million people by 2030. The increasing disposable income is the reason why more couples are buying dwellings, as they both earn, and hence developers are upselling. The cities of Bengaluru, Chennai, and Pune are leading the way in terms of speedy growth in the mid-segment market.
- Developers are taking up mid segment projects with 31 new launches in the first half of 2025 in the ₹80 lakh to ₹1.5 crore category, which is more than the segment’s 27% sales share and higher than the segment’s sales.
7. Mixed Use Developments Gain Prominence
- Mixed-use projects integrating residential, commercial, retail, hospitality, and entertainment spaces within single ecosystems are reshaping India’s real estate landscape.
- These include integrated living with housing, workplaces, healthcare, education, and retail within walkable distances; transit-oriented proximity to metro stations, airports, and highways; smart infrastructure with energy-efficient design and AI-enabled security; and community spaces including parks, cultural centres, and shared recreation areas. By 2025, these developments will be viewed as future proof investments aligned with India’s growth trajectory.
8. Build-to-Rent Model
- The Build-to-Rent (BTR) model of purpose-built rental complexes with professional management is becoming more and more accepted as a modern housing solution. BTR homes, unlike those in traditional rental properties, are created specifically in the case of dedicated rental complexes, thus making such places predictable, easy to maintain and a good fit for the product-tenant relationship.
- The residences can generate rental yields that range from 3% to 8%, and the location comes with contemporary living complete with a gym, a rooftop garden, and 24/7 surveillance, all of which are directly run by the property owners.
- BTR developers report that their projects have an occupancy rate that is up to 2.5 times faster than properties built for sale.
9. Senior Living Communities
- The rapid changes in the Indian population pyramid, with the increase of the elderly people who will be more than 191 million in 2030 and 346 million in 2050, are the main cause of the dramatic rise of senior living communities. The market size is expected to double in 2030 as a result of investment of $4.8 to $8.4 billion, besides the annual growth rate of 17.4%.
- So, real estate constructs age-friendly design, including wheelchair-accessible layouts, non-slip floors, wider doorways, emergency medical systems with 24/7 doctor-on-call services, wellness facilities with meditation rooms and yoga decks, and community spaces to combat loneliness. This is the next interesting business model for real estate.
Conclusion
As technology changes, it impacts every business, not only technology companies; it also affects real estate and gives another opportunity and rethinks the real estate developers. As you can see, smart home development has an impact on technology. Co-living for Gen Z and millennials for better cost efficiency.
Written by Yatheendra N