According to recently released data by the Reserve Bank of India (RBI), housing prices in major metropolitan cities showed mixed performance in the fourth quarter of 2025-26 (Q4FY26). Delhi's housing price index stood at 96.55 using the base year of 2022-23, indicating that houses in the national capital were less expensive in Q4FY26 compared to prices three years back. Similarly, Hyderabad's index reached 99.87, while Mumbai and Kolkata saw slight increases above 100, at 106.19 and 106.59 respectively. Among metro cities, Chennai and Lucknow were exceptions to this trend, showing higher price appreciation. The RBI's latest monetary policy decision arrives at a crucial phase for India's real estate sector, with the central bank maintaining the repo rate at 5.25% in June 2026, keeping home loan rates stable for potential buyers.
The data reveals a significant trend where smaller cities significantly outperformed metropolitan areas in housing price appreciation. Smaller cities such as Jaipur, Nagpur, and Kanpur saw the most appreciation in Q4FY26 compared to Q4FY23, according to the RBI analysis. Gautam Budh Nagar in Uttar Pradesh was among the smaller cities which saw the lowest appreciation. At the all-India level, houses on average saw 15.66 per cent appreciation in Q4FY26 against Q4FY23, with the RBI analyzing the HPI of 18 cities. The trend suggests that smaller cities are emerging as more attractive investment destinations compared to traditional metropolitan markets, challenging common perceptions about residential real estate markets.
The RBI data challenges common perceptions about residential real estate markets, particularly in major cities. While buyers often complain about rising prices in Delhi and investors see opportunities in the national capital, the actual price data shows a different reality. The trend suggests that smaller cities are emerging as more attractive investment destinations compared to traditional metropolitan markets. This shift in housing price dynamics across different city categories provides valuable insights into current real estate market dynamics and investment patterns across India's urban landscape. The stable repo rate environment of 5.25% is expected to support continued growth in the housing sector, with developers seeing positive signals for both housing and commercial real estate growth.
