Behind the glittering headlines of record-high stock prices for listed developers, India's real estate market is facing a concerning construction crisis that threatens to undermine the sector's apparent boom.
The Alarming Data Behind the Headlines
According to a recent Residential Market Report from Liases Foras, a prominent data analytics firm, a dangerous gap is emerging between new project launches and actual construction completion across India's top eight cities. The statistics reveal a sharp decline in construction activity that has experts sounding the alarm.
The share of constructed supply compared to total marketable supply has plummeted from 75% in 2017 to just 57% in 2025, indicating that nearly half of the promised housing inventory remains unbuilt despite aggressive marketing and sales.
Understanding the Depth of the Problem
This significant 18 percentage point drop over eight years highlights a systemic issue within India's residential real estate sector. While developers continue to launch new projects and celebrate stock market successes, the actual building work on the ground is failing to keep pace with their ambitious announcements.
The situation has become serious enough to attract commentary from industry leaders like Sanjay Dutt, MD & CEO of Tata Realty and Infrastructure, who recently appeared on the Let's Get Real podcast to explain the widening gap and its implications for homebuyers and investors.
What This Means for Homebuyers and the Market
The construction slowdown across major urban centers raises critical questions about project delivery timelines and the financial health of developers. With completed inventory shrinking as a proportion of total supply, prospective homebuyers face increased uncertainty about when their investments will materialize into actual homes.
This trend also suggests that the much-publicized recovery in real estate might be more fragile than surface indicators suggest. The disconnect between market enthusiasm and on-ground construction progress could signal underlying challenges in project financing, regulatory approvals, or operational execution that need immediate attention from both industry players and policymakers.
As the data from November 2025 indicates, the Indian real estate sector requires careful monitoring to ensure that the current construction lag doesn't evolve into a more severe crisis affecting millions of homebuyers and the broader economy.
