Mumbai, Sept. 4 -- Brickwork Ratings said India's real estate sector could require Rs 50 trillion (tn) in funding by 2036 as residential and commercial development expands, and it projected a stable overall credit outlook through FY27. The agency said demand for luxury homes, high-quality office space and institutional investment would support the market despite near-term revenue pressures. Residential development was identified as likely to account for the largest share of the funding requirement.
Brickwork projected the market to reach around US$1 tn by 2030 and forecast revenue growth to slow to 0.2 per cent in FY26 from 15.8 per cent in FY25, improving to 5.5 per cent in FY27 as premium housing contributes. It noted residential sales across major cities rose 31 per cent year on year and that luxury prices climbed 10-12 per cent in FY25. Operating margins were projected to rise from 30.1 per cent in FY25 to about 33.3 per cent by FY27.
The report said financial profiles among leading developers remain relatively strong, aided by lower debt levels and greater use of joint development agreements rather than large land loans. Liquidity was supported by pre-sales collections, private equity inflows and Real Estate Investment Trust listings, with interest coverage seen at about 2.8 times in FY26 and the debt service coverage ratio at about 1.1 times. The agency warned that unsold inventory in some markets and potential refinancing needs could pressure cash flows.
It observed that commercial real estate continued to attract institutional capital, with office assets taking more than 40 per cent of inflows in the first half of 2026, drawing US$1.9 billion (bn) against US$0.5 bn for residential. Homes priced above Rs 10 million (mn) accounted for 64 per cent of new launches in the top seven cities in Q1 2026, up from 45 per cent a year earlier. New supply remained high, with leading eight cities adding 0.187 mn units in H1 2026 and annual launches seen at 0.35-0.4 mn through 2027; overall sales value was expected to rise by 10-12 per cent in FY27.
Published by HT Digital Content Services with permission from Construction World.