India's Real Estate Sees 47% Rise in Q1 2025 Investments
India's real estate market gained $813 Mn in Q1 2025, up 47% YoY. Residential sector dominated; foreign investment soared to 43%.
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Institutional inflows into India’s real estate market climbed to $813.3 million in the first quarter of 2025, up 47 per cent from $552.1 million in Q1 2024 and down 63 per cent from $2.22 billion in Q4 2024, according to Vestian Research.
Investments by asset type shifted sharply toward housing, which captured 62 per cent of total funding in Q1 2025 compared with 41 per cent in the same quarter last year. Residential allocations jumped 125 per cent year‑on‑year to $506.1 million. Commercial real estate—offices, retail, co‑working and hospitality—accounted for 38 per cent of the quarter’s total, rising 33 per cent from $231.6 million in Q1 2024 to $307.2 million. Industrial and warehousing projects saw no notable funding this quarter, and diversified assets were likewise minimal.
Investor mix also changed. Foreign capital surged more than thirtyfold, from $11 million in Q1 2024 to $346.9 million in Q1 2025, lifting overseas participation from 2 per cent to 43 per cent. Domestic investors supplied the remaining 57 per cent, contributing $466.4 million, a 14 per cent drop from $541.1 million a year ago. Co‑investment structures involving both foreign and Indian partners were negligible in Q1 2025 but represented 32 per cent of deals in Q4 2024.
“Institutional commitment to long‑term real estate projects continues,” said Shrinivas Rao, CEO of Vestian. “As infrastructure projects progress and economic indicators firm, we expect funding inflows to build momentum.”
Vestian Research data show quarterly flows of $550 million in Q1 2024, $3.10 billion in Q2 2024, $960 million in Q3 2024, $2.22 billion in Q4 2024 and $813.3 million in Q1 2025. Analysts point to interest rate stability and policy support as factors driving renewed portfolio allocations.
With planned metro projects and highway expansions advancing in key cities, investment managers say India’s real estate sector offers a platform for long‑term returns. Market participants are watching Q2 2025 for signs of further yield compression and sector diversification.
