Realty Stocks Decline Amid Profit Booking, Godrej Properties Fell Over 4%

The real-estate stocks witnessed a dip after profit booking continued for the third consecutive day on September 24 with Godrej Properties, and Oberoi Realty as top losers on Nifty Realty Index.

At 2:46 pm on Wednesday, the Nifty Realty fell 2.48 per cent or 22.65 points (pts) to 890.70, on track to end today's trading session in red.  

The three straight days of profit booking comes after the realty stocks rose for six out of seven straight sessions earlier in September over rate cuts by Federal Reserve and GST reforms.

On September 24 at 2:55 pm, Godrej Properties was down by 4.12 per cent and Oberoi Realty fell by 2.76 per cent, respectively.

In the backdrop of profit booking in realty stocks, Nuvama Institutional Equities noted that real estate sector should brace for volatility given hurdles in form of lack middle-income housing and decline in housing affordability, and slow volume growth.

"We believe volatility shall persist, and reckon stocks shall continue to be range-bound with downside protected by falling mortgage rates even as the upside is capped by valuation/volume growth concerns" the report said

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Further, the brokerage firm said sales volumes dropped between June 2024 and May 2025. The firm explained that rising home prices have reduced affordability, with premium and luxury segments dominating sales, resulting in a narrow housing cycle. They expect price increases to slow down, which could reduce investor-driven demand.

The brokerage report also pointed out that the National Capital Region (NCR) and Pune remain the strongest markets, with inventory levels of just 10 and 13 months, respectively. Other cities have higher inventory levels, ranging from 17 to 21 months, except Hyderabad, which has 26 months of inventory.

Nuvama anticipates that real estate stocks will continue trading within a limited range and that volatility will persist. Falling mortgage rates might soften the downward pressure, but concerns around valuations and volume growth will likely restrict upward movement.

In a separate note last week, Nuvama suggested that the market consistency seen from FY21 to FY24 may no longer continue. The brokerage believes Bengaluru and Chennai’s housing markets still have room for growth, while Hyderabad may have already peaked.

Regarding the Mumbai Metropolitan Region (MMR), the report describes it as being in a mid-cycle phase. Pune, meanwhile, appears to be experiencing “growth fatigue,” while Gurugram is dealing with challenges related to housing affordability.