Chennai registers 9,198 home sales in H1 2026; office space completions jump 149%: Knight Frank India

July 11, 2026

Chennai: Chennai’s real estate market remained resilient during the first half of 2026, with residential sales touching 9,198 housing units, while commercial real estate continued to witness strong occupier demand despite global economic uncertainties, according to Knight Frank India’s latest India Real Estate: Residential and Office H1 2026 report.

The report states that residential sales in Chennai increased 3% year-on-year to 9,198 units, while the city’s average residential price rose 5% to ₹7,555 per sq ft. Housing launches remained largely stable at 9,588 units, indicating developers’ cautious yet optimistic approach towards new supply.

Mid and premium housing continue to drive demand

Knight Frank noted that Chennai’s housing market is increasingly shifting towards mid-segment and premium homes, supported by strong end-user demand, expanding employment opportunities, and major infrastructure developments.

Homes priced between ₹5 million and ₹10 million remained the largest category, accounting for 47% of total residential sales. Meanwhile, the ₹10–20 million segment increased its share to 27%, while homes priced between ₹20–50 million accounted for 12% of sales, reflecting growing buyer preference for larger homes and lifestyle-oriented developments.

In contrast, affordable housing below ₹5 million continued to lose market share, declining from 22% in H1 2025 to 12% in H1 2026, primarily due to rising construction costs and affordability pressures.

Residential prices continue to appreciate

The report highlighted that average residential prices in Chennai climbed 5% YoY to ₹7,555 per sq ft.

Among various micro-markets:

Perumbakkam recorded the highest annual price appreciation of 15%
Mogappair followed with 13%
Perungudi registered 10% growth

These locations benefited from improving infrastructure, enhanced connectivity and sustained end-user demand.

Office market remains one of India’s strongest

Chennai’s commercial real estate market also posted impressive numbers.

The city recorded 3.6 million sq ft of office leasing during H1 2026. Although leasing volumes declined 28% YoY due to the exceptionally high base recorded in H1 2025, Chennai still registered its third-highest first-half office leasing performance and the sixth-highest half-year leasing volume since 2012, demonstrating the market’s underlying strength.

Office completions surged 149% year-on-year to 2.6 million sq ft, while vacancy levels declined further to 8.5%, indicating healthy absorption despite significant new supply.

GCCs dominate office leasing

Global Capability Centres (GCCs) remained the largest occupier segment, contributing 45% of total office leasing activity.

Flexible workspace operators significantly expanded their presence, accounting for 30% of office leasing compared to 20% a year earlier. Domestic companies also emerged as strong demand drivers, increasing their share to 18%, while third-party IT firms accounted for 7%.

Rental values continue to rise

Average office rentals in Chennai increased 7% year-on-year, reaching ₹74.5 per sq ft per month.

Among major business districts:

SBD OMR recorded the highest rental appreciation at 8%
SBD and PBD Ambattur witnessed 4% growth each
PBD OMR & GST Road increased 3%
CBD registered 1% growth

Knight Frank’s outlook

According to Joseph Thilak, National Director – Occupier Strategy and Solutions (Hyderabad & Chennai), Knight Frank India, Chennai continues to demonstrate strong resilience in both residential and commercial real estate. Growth is being supported by expanding infrastructure, a diversified employment base, increasing GCC activity, metro connectivity projects, and sustained end-user demand, positioning Chennai among India’s most stable real estate markets.