6.3 Lakh Unsold Homes: The Growing Gap in India’s Housing Market
- Posted: 13 Nov 2026, 11:55 AM IST
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India’s housing market is seeing a growing mismatch between supply and demand.
The top seven cities sold around 1 lakh homes in Q3 2026. Developers, however, launched 1.14 lakh homes during the same period.
As supply continues to outpace sales, unsold housing inventory has climbed to 6.3 lakh homes.
The gap has been building for some time.
Home sales more than doubled from 2.37 lakh in 2021 to 4.77 lakh in 2023. However, momentum slowed in 2024.
Sales declined to 4.59 lakh homes in 2024 and fell further to 3.96 lakh in 2025.
The supply-demand balance has also changed.
In 2024, developers launched 47,000 fewer homes than buyers purchased. By 2025, launches exceeded sales by 23,600 homes.
The gap widened further in 2026.
During January-September 2026, developers launched 3.47 lakh homes, while sales stood at 2.93 lakh.
This created a supply surplus of 54,050 homes.
For every 100 homes sold, developers launched 118 in the first nine months of 2026, compared with 103 a year earlier.
Sales grew by around 2% during this period, while launches increased 17%.
The gap has narrowed from 15,300 homes in Q2 2026, but launches continue to outpace sales.
Some developers brought projects to market that had been held back in Q2. Larger developers were also launching projects on land acquired in 2024 and 2025.
Customer collections are another source of funding for construction.
For instance, Godrej Properties collected ₹5,318 crore from customers in Q3 2026 and reported net debt of ₹7,908 crore at the end of September.
This shows how customer payments can support a developer’s funding requirements, even as new supply continues to enter the market.
The growing gap between launches and sales is now visible in the inventory numbers.
Unsold housing stock across the top seven cities rose 12% year on year to 6,30,600 homes in September 2026.
The increase has been steady.
Unsold inventory stood at 5,61,750 homes in Q3 2025, rose to 5,76,600 in Q4 2025 and crossed 6 lakh in Q1 2026.
It increased further to 6,16,500 in Q2 before reaching 6,30,600 in Q3.
However, unsold inventory does not mean all these homes are ready to move into. It also includes properties that are still under construction.
The build-up varies significantly across cities.
Mumbai Metropolitan Region (MMR) has the highest unsold inventory, with 1,98,050 homes. But it also recorded the highest sales during the quarter.
Hyderabad presents a different picture.
The city had 1,14,700 unsold homes, and developers launched 18,950 homes against sales of 12,950 in Q3 2026.
The inventory overhang helps explain the difference.
Inventory overhang measures how many months it would take to sell existing unsold homes at the current sales pace.
Hyderabad has the highest overhang at 28 months, followed by Kolkata at 22 months. MMR stands at 19 months, while NCR and Chennai are at 18 months each.
Despite rising unsold inventory, property prices have continued to climb across all seven cities.
The average quoted price across these markets reached ₹9,714 per sq. ft. in Q3 2026, up 7% from a year earlier.
NCR recorded the highest annual increase at 12%, followed by Bengaluru at 8%. Kolkata saw prices rise 7%, while Pune and Hyderabad recorded 6% growth each.
The reasons behind these price movements differ from one city to another.
In NCR, luxury launches have lifted the average price. Bengaluru continues to see demand from buyers purchasing homes to live in.
In Hyderabad, most new launches were concentrated in the higher-priced segment. In MMR, much of the new supply came from Navi Mumbai, particularly Panvel.
There are a few other factors keeping prices firm.
Uncertainty around the West Asia conflict and concerns about IT jobs had led some buyers to postpone purchases in the previous quarter. Some of these buyers returned to the market in Q3.
Despite this recovery, sales were up just 3% year on year, compared with an 18% rise in launches.
The type of homes developers are launching also influences the average market price.
In Q3 2026, homes priced above ₹1.5 crore accounted for 38% of new launches across the seven cities.
Another 31% were priced between ₹80 lakh and ₹1.5 crore.
Homes priced between ₹40 lakh and ₹80 lakh accounted for 17% of launches, while those below ₹40 lakh made up 14%.
This matters because a larger share of premium launches can push up the average quoted price, even when prices of existing homes do not change.
A new project quoting a higher rate per square foot can lift the city average without necessarily making every existing home more expensive.
For homebuyers, rising supply can mean more properties to choose from, particularly in markets with growing inventory.
But the choice varies by city and budget.
Hyderabad, for instance, has 28 months of unsold inventory, yet 66% of its new launches cost above ₹1.5 crore. Buyers with smaller budgets may still find limited options.
Prices also remain firm.
The seven-city average quoted price rose from ₹9,105 to ₹9,714 per sq. ft. over the year, keeping affordability a concern even as more homes enter the market.
More inventory may give buyers greater choice and room to compare projects, but it does not automatically mean lower prices.
The market is not showing signs of a widespread crisis yet.
Sales recovered to around 1 lakh homes in Q3 2026, and the gap between launches and sales narrowed from 15,300 homes in Q2 to 14,100 in Q3.
However, the broader trend still needs attention.
Developers launched 54,050 more homes than buyers purchased during the first nine months of 2026.
Unsold inventory has also risen for several consecutive quarters.
If sales fail to keep pace with new launches, some developers could face pressure to fund construction and clear existing stock.
The next few quarters will be important in determining whether demand can absorb the additional supply.
For investors, the key is to watch whether housing demand can absorb the growing supply and support developers’ sales growth.
Sources:
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Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
When she's not decoding markets, she trades charts for canvases, chasing art, painting, and architecture across cities she's yet to explore.
