South Zone leads sentiment with robust office leasing and luxury housing demand
Hyderabad, November 16, 2025 – Hyderabad’s real estate market has demonstrated remarkable strength in Q3 2025, with property prices posting a year-on-year increase of 13-19% compared to the same period last year, according to the Knight Frank–NAREDCO Real Estate Sentiment Index.
The city, along with NCR and Bengaluru, continues to drive residential price momentum, supported by robust demand in high and upper-mid ticket size housing segments. India’s overall real estate outlook strengthened in Q3 2025, backed by robust office leasing, resilient high-end residential demand, and favourable macroeconomic conditions including stable interest rates, easing inflation, and improved liquidity.
South Zone Leads Market Sentiment
The South Zone remained the most buoyant with a sentiment score of 62, driven by strong leasing momentum in Bengaluru and Hyderabad alongside sustained demand for high ticket size housing segments. The Current Sentiment Score rose to 59 from 56 in the previous quarter, while the Future Sentiment Score remained steady at 61, both indicating optimism among real estate stakeholders.
Office Leasing Drives Growth
Hyderabad’s commercial real estate sector has shown structural depth with robust leasing pipelines. The office market continues to attract significant interest from corporates and technology companies, contributing to the city’s strong performance in the real estate sector.
Real estate developers and financial institutions remain optimistic about Hyderabad’s growth prospects, with demand in the premium residential segment continuing to be strong.
Luxury Housing in Focus
About 71% of respondents expect new residential launches to remain stable or increase, as developers focus on higher-ticket projects while moderating activity in lower ticket size segments to prevent oversupply. Optimism around residential sales has grown, with 74% of respondents expecting sales to either remain stable or improve, compared to 52% in Q2 2025.
Meanwhile, 92% of respondents anticipate prices to remain stable or rise, indicating sustained confidence in Hyderabad’s real estate market.
Favourable Market Conditions
Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, “The sustained optimism reflected in the Q3 Sentiment Index underscores the sector’s resilience and adaptability. Demand in the premium residential segment remains healthy, while the office market continues to demonstrate structural depth with strong leasing pipelines. Stable interest rates, easing inflation, and improved liquidity have reinforced overall sentiment.”
The report noted that improved confidence stems from stable interest rates, benign inflation, and healthy domestic liquidity, all of which continue to underpin growth in Hyderabad’s real estate market.
Market Outlook
As Hyderabad approaches 2026, market experts expect the city to maintain steady momentum across both residential and commercial segments. The combination of strong office leasing activity, premium housing demand, and supportive macroeconomic conditions positions Hyderabad as one of India’s most dynamic real estate markets.
The 13-19% year-on-year price increase in Q3 2025 underscores strong demand and limited supply in the high-end segment, reflecting Hyderabad’s growing appeal among investors and homebuyers seeking quality projects in prime locations.
