India Ratings & Research expects FY27 to be a moderating year after the FY23–FY25 upcycle. MMR remains the largest housing micro-market (26% share), while office leasing is projected to rise to 85–90 msf in FY27.
By Arosh John, Founder, John Real Estate (MahaRERA Reg. No. A51700001835) | Editor-in-Chief, Thane Real Estate News (TREN)
Mumbai | 27 February 2026
India Ratings & Research (Ind-Ra) expects India’s real estate cycle to enter a moderating phase in FY27, after strong growth during FY23–FY25 and slower momentum in FY26. The agency’s outlook projects residential sales growth of 5%–7% year-on-year in FY27, driven largely by value growth.
Ind-Ra’s FY27 projections are built on trends visible in FY26, with several of the latest city indicators in the outlook captured through 1HFY26 (April–September 2025) and YTD FY26 (year-to-date FY26, as per the report’s dataset).
Source: India Ratings & Research (Ind-Ra) Sector Outlook, dated 24 February 2026 (data inputs include Liases Foras).
Residential Real Estate Outlook For FY27
Ind-Ra notes that absorption and pricing have been supported by premium and luxury segments, which have also shifted new supply preferences toward upper mid-income, premium, and luxury products.
The agency expects price growth to remain project-specific and range-bound at 4%–8% YoY during FY26 and FY27, as the base effect and moderating demand temper headline growth.
Ind-Ra also flags a clear demand nuance: slower net headcount additions across large Indian IT services firms, and role consolidation due to AI/automation, are reducing near-term upgrade demand in IT-dependent housing markets such as Bengaluru, Pune, and Hyderabad.
MMR Remains India’s Largest Housing Micro-Market
In Ind-Ra’s clustering, the Mumbai Metropolitan Region (MMR) remains the largest micro-market, accounting for 26% of the top eight real estate clusters.
The outlook also highlights that Bengaluru, Ahmedabad, and MMR posted the highest YoY sales growth of 15%–17% (TTM 1HFY26), underscoring MMR’s continued depth in end-user-plus-investor demand.
Supply, Inventory, And QTS: The FY27 Watchlist
Ind-Ra notes that inventory remained moderate due to slower launches, led by approval issues. Still, a moderating demand environment alongside an active launch pipeline could gradually increase inventory in FY27, with risk pockets emerging as launches move ahead of absorption.
Key indicators referenced in the outlook include:
- Supply in MMR declined ~18% YoY (YTD FY26)
- Aggregate unsold inventory across the tracked market is ~1 billion sq ft (end-1HFY26)
- Quarters-to-sell (QTS) remained around ~7
- In the comparative cluster set, MMR is indicated as the highest unsold inventory market
Note: 1HFY26 in the report refers to April–September 2025. YTD FY26 refers to year-to-date FY26, as compiled in the Ind-Ra dataset used for the outlook.
Mumbai Office Market Outlook: Leasing Momentum Continues Into FY27
On commercial real estate, Ind-Ra expects the leasing cycle to remain constructive, supported by domestic demand and continued expansion by global capability centres (GCCs).
- FY27 gross leasing is projected at 85–90 msf (up 12%–14% YoY)
- MMR, Bengaluru, and Chennai are cited as key contributors, with absorption potentially rising 15%–25% YoY in FY27 on active pipelines and GCC-led take-up
- Ind-Ra notes that 1HFY26 leasing softness was influenced by a high base and limited Grade A ready supply in prime markets, with pickup expected in 2HFY26 and into FY27
On rentals, Ind-Ra’s outlook indicates:
- Pan-India office rentals are expected to rise 5%–7% in FY26, before moderating to 4%–6% in FY27
- MMR rentals rose ~4% YoY to ~INR 136 psf in 1HFY26, reflecting steady demand and a quality-first tilt in prime micro-markets
- Vacancy is expected to remain range-bound at 12%–18% in FY27, supported by sustained leasing activity and GCC expansion
Thane View Within The MMR Cycle
A moderating year is usually less about headlines and more about selection.
For Thane buyers and investors, the practical filters tighten:
- Delivery Visibility Comes First: Projects with clearer timelines and stronger on-ground execution tend to hold value better when the broader cycle cools.
- Track Absorption, Not Noise: In premium-heavy pipelines, booking velocity and unit movement tell the real story—more than launch marketing.
- Micro-Location Outperforms Averages: In Thane, corridor-level differences matter—access, last-mile connectivity, social infrastructure, and end-use profile can meaningfully shape outcomes.
- Inventory Creates Negotiation Windows: Where stock builds without differentiation, buyers gain leverage. Where the product remains unique, pricing stays firmer.
- Infrastructure Under Execution Still Matters: Thane also benefits from multiple connectivity projects under execution (including Metro Lines 4 and 5). As corridors progress in phases, pockets near operational nodes often reprice faster than the regional average—provided project execution and last-mile access are clear.
Data Snapshot
Residential (FY27 Outlook)
- Expected FY27 sales growth: 5%–7% YoY
- MMR share of top eight clusters: 26% (largest micro-market)
- Expected price rise (FY26–FY27): [4%, 8%] YoY (project-specific)
- FY27 monitor variables: launch pipeline vs absorption; inventory build-up pockets
Commercial (FY27 Outlook)
- Expected FY27 gross leasing: 85–90 msf (12%–14% YoY)
- Key FY27 contributors: MMR, Bengaluru, Chennai
- Office rentals: +5%–7% in FY26; +4%–6% in FY27 (Ind-Ra)
- MMR rentals: ~INR 136 psf (1HFY26), ~4% YoY
- Vacancy band (FY27): 12%–18%
Also READ: Thane 2026–2030: A Connectivity-Led Investment Case Taking Shape
About The Author
Arosh John is the Founder of John Real Estate (MahaRERA Reg. No. A51700001835) and the Editor-in-Chief of Thane Real Estate News (TREN). Based in Thane, he is a leading real estate consultant known for transaction-led market intelligence and execution-focused advisory across Thane and the wider MMR. His core specialisations include luxury apartments, villa communities and plotted-villa land, high-value resale mandates, and NRI advisory—with a strong emphasis on resale liquidity, pricing strategy, negotiation, and due diligence.
Disclaimer
This article is an editorial summary of a sector outlook published by India Ratings & Research (Ind-Ra) dated 24 February 2026. All trademarks, brand names, and logos are the property of their respective owners. This content is for information and market education only and does not constitute investment, legal, or tax advice.
