Pune’s Residential Market Faces Critical Recalibration Amid Record Price Gains
The July 2025 Gera Pune Residential Realty Report signals a pivotal shift in Pune’s housing landscape, marking the end of a seven-year growth streak. The bi-annual study spanning 14 years and tracking over 300,000 under-construction units reveals market consolidation driven by cumulative price increases and larger home sizes.
Key Drivers: Price Surge and Property Size Growth
- Pattern of Appreciation: Residential prices rose 7.31% YoY, continuing a five-year trend of 40% increases. This moderate annual gain masks the real pain point for buyers.
- Bigger Homes, Higher Costs: Average property sizes expanded by 25% over five years, compounding the price effect. Together, these factors created a 76% surge in average ticket prices.
- Affordability Crisis: House price-to-income ratios worsened by 45%, reaching 6.52 times annual income. Budget and upper-mid segment buyers now face insurmountable entry barriers.
Market Reactions: Segment-Specific Trends
Luxury Buyers Opt for Space
| Price Tier | Sales Trend | Size Preference |
|---|---|---|
| <₹1 Cr | Declining demand | Small formats (1 BHK) down |
| >₹1.5 Cr | Stable or rising | 1,200+ sq.ft homes surging |
Affluent buyers increasingly prioritize larger homes (1,200+ sq.ft), with sales in this category up 13% despite higher costs. Conversely, homes over 1,200 sq.ft above this threshold saw a 17% sales drop.
Inventory Pressures Mount
- Sales Decline: Property prices have increased, which affects the buyer
- Supply Backlog: Inventory overhang hit 10.78 months the highest since 2020 indicating slower absorption.
- Launch Slowdown: New project launches dipped 10.3%, reflecting developer caution amid reduced demand.
Future Outlook: Niche Opportunities Emerge
The report predicts continued bargains for supersized homes as builders prioritize larger formats to cater to wealthier buyers. However, it dismisses expectations for a 1 BHK resurgence, citing persistent demand for upgraded living spaces post-pandemic. Rohit Gera, MD of Gera Developments, notes that 1 BHK supply may not recover even with slower sales, as buyer preferences persist toward sparser but more spacious options.
This recalibration phase positions Pune’s market for selective growth rather than broad-based expansion, with affordability constraints reshaping buyer behavior and developer strategies in the short-to-medium term.