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Q1 2025 Index Shows Cautious Sentiment in Real Estate: Report
Real Estate

Q1 2025 Index Shows Cautious Sentiment in Real Estate: Report

The 44th edition of the Knight Frank 鈥� NAREDCO Real Estate Sentiment Index Q1 2025 (January鈥揗arch 2025) report reflects a cautiously optimistic mood among real estate stakeholders. The Current Sentiment Score in Q1 2025 dipped slightly to 54 from 59 in Q4 2024, down from 59 in Q4 2024, while the Future Sentiment Score eased to 56, compared to 59 in the previous quarter. Though both scores, remain in the optimistic zone, signal growing stakeholder caution amid global trade tensions, economic recalibration, and regional volatility. Despite this, positive momentum in commercial real estate and sustained activity in high-value residential segments continue to support sentiment resilience. According to the survey findings, residential outlook leans toward stability amid cautious launch plans. In Q1 2025, 93 per cent of stakeholders expect residential prices to remain stable or improve, while 67 per cent anticipate stability or growth in new launches. Residential sales sentiment, however, has moderated with only 50 per cent expecting it to either improve or stay the same compared to 88 per cent in Q1 2024.

The office segment remains a bright spot, supported by robust leasing activity and stable rental growth. In Q1 2025, 82 per cent of stakeholders anticipate office leasing volumes to either hold steady or increase, while 91% expect office rents to remain stable or rise鈥攕ignalling sustained occupier confidence and healthy demand.

The quarterly Knight Frank-NAREDCO Real Estate Sentiment Index report captures the current and future sentiments towards the real estate sector, as well as economic conditions and funding availability as perceived by the supply-side stakeholders and financial institutions. A score of 50 represents a neutral view or status quo; a score above 50 demonstrates a positive sentiment; and a score below 50 indicates a negative sentiment.

The Developer Future Sentiment Score dropped to 53 in Q1 2025 from 58 in Q4 2024, as developers recalibrate supply strategies amid slowing low to mid ticket size segment demand in the residential sector and rising costs.

The Non-Developer Future Sentiment Score (including banks, financial institutions, and PE funds) moderated to 57 from 60, reflecting a wait-and-watch approach on capital deployment, while remaining optimistic on office and high-ticket size residential segments.

Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, 鈥淨1 2025 marks a phase of strategic recalibration for the real estate sector, shaped by evolving global trade dynamics, softening consumption, and heightened geopolitical sensitivity. Despite these shifts, India鈥檚 office market remains resilient, and the continued strength of the premium residential segment affirms the sector鈥檚 underlying robustness. As macroeconomic indicators adjust, real estate is displaying its capacity to adapt with stability and long-term potential.鈥�

The 44th edition of the Knight Frank 鈥� NAREDCO Real Estate Sentiment Index Q1 2025 (January鈥揗arch 2025) report reflects a cautiously optimistic mood among real estate stakeholders. The Current Sentiment Score in Q1 2025 dipped slightly to 54 from 59 in Q4 2024, down from 59 in Q4 2024, while the Future Sentiment Score eased to 56, compared to 59 in the previous quarter. Though both scores, remain in the optimistic zone, signal growing stakeholder caution amid global trade tensions, economic recalibration, and regional volatility. Despite this, positive momentum in commercial real estate and sustained activity in high-value residential segments continue to support sentiment resilience. According to the survey findings, residential outlook leans toward stability amid cautious launch plans. In Q1 2025, 93 per cent of stakeholders expect residential prices to remain stable or improve, while 67 per cent anticipate stability or growth in new launches. Residential sales sentiment, however, has moderated with only 50 per cent expecting it to either improve or stay the same compared to 88 per cent in Q1 2024.The office segment remains a bright spot, supported by robust leasing activity and stable rental growth. In Q1 2025, 82 per cent of stakeholders anticipate office leasing volumes to either hold steady or increase, while 91% expect office rents to remain stable or rise鈥攕ignalling sustained occupier confidence and healthy demand.The quarterly Knight Frank-NAREDCO Real Estate Sentiment Index report captures the current and future sentiments towards the real estate sector, as well as economic conditions and funding availability as perceived by the supply-side stakeholders and financial institutions. A score of 50 represents a neutral view or status quo; a score above 50 demonstrates a positive sentiment; and a score below 50 indicates a negative sentiment.The Developer Future Sentiment Score dropped to 53 in Q1 2025 from 58 in Q4 2024, as developers recalibrate supply strategies amid slowing low to mid ticket size segment demand in the residential sector and rising costs.The Non-Developer Future Sentiment Score (including banks, financial institutions, and PE funds) moderated to 57 from 60, reflecting a wait-and-watch approach on capital deployment, while remaining optimistic on office and high-ticket size residential segments.Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, 鈥淨1 2025 marks a phase of strategic recalibration for the real estate sector, shaped by evolving global trade dynamics, softening consumption, and heightened geopolitical sensitivity. Despite these shifts, India鈥檚 office market remains resilient, and the continued strength of the premium residential segment affirms the sector鈥檚 underlying robustness. As macroeconomic indicators adjust, real estate is displaying its capacity to adapt with stability and long-term potential.鈥�

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