This shift is reflected in a recent report from real estate data analytics firm, PropEquity. The report highlights that the average house prices in 23 tier-II cities increased by 65 percent from January to September this year, with only five cities seeing a decline in prices.
Notably, Jaipur saw the highest price increase, with average prices of newly launched housing projects rising 65% to Rs 6,979 per sq ft during the period. In contrast, the average rate in Jaipur last year was Rs 4,240 per sq ft, reflecting the growing demand for real estate in Tier-II cities as people look for alternatives to urban congestion.
Sameer Jasuja, founder and CEO, PropEquity, said, “Tier II cities have seen renewed interest from developers, corporates, financial institutions and the investment community. Cheaper availability of land in these cities has led to massive connectivity infrastructure. Growth at scale and strong demand have led to an increased supply of premium and luxury housing.”
According to data from North India, Agra saw a 59 per cent rise in prices, followed by Chandigarh 34 per cent, Bhiwari 25 per cent, Indore 20 per cent, Dehradun 14 per cent, Ludhiana 11 per cent and Lucknow. 1 percent increase. . However, Bhopal saw a decline of 5 percent while Mohali and Sonepat saw a decline of 8 percent and 26 percent respectively.
Yashnik Vasan, Managing Director, Royal Green Realty hailed the growth, saying that the phenomenal 65% growth in house prices in the top tier II cities, highlights the growing demand for quality living space in these emerging markets. “In Delhi’s neighbourhood, Bahadurgarh is gaining prominence. It benefits from infrastructure upgrades, including better road networks, and metro connectivity. Indore has also become a prominent Tier 2 city real estate hub. Because it has advanced IT and education sector, infrastructure, and diverse options.”
In South India, Guntur saw a 51 percent increase in house prices, followed by Mangalore at 41 percent, Visakhapatnam at 29 percent, Vijayawada at 21 percent, Coimbatore at 11 percent, Goa at 6 percent, and Kochi at 2 percent. happened On the other hand, Trivandrum experienced a decline of 4%, while Mysore saw a steep decline of 14%.
In western India, Gandhinagar recorded a 19% rise in house prices, followed by Surat at 14%, Nagpur at 12%, Vadodara at 10%, and both Nashik and Ahmedabad at 4%. In eastern India, house prices in Bhubaneswar rose by 15% and Raipur by 14%, reflecting continued growth in these cities.
Commenting on the report, Madhur Gupta, CEO, Hero Realty said that influx of job opportunities, low cost of living, and affordable housing are the main factors driving the demand and supply of real estate in Tier 2 cities, which will attract buyers. are influenced by strong emotions. “The media is influencing this trend by promoting high-end lifestyle and high-end amenities, creating new aspirations in Tier 2 and Tier 3 cities, and increasing demand. Developers are driving this aspirational lifestyle. In response to the introduction of high-value inventory and increasing affordability, IT/ITES and Smart City initiatives such as Chandigarh’s expansion of the market size in top tier 2 cities. In the extension of At the forefront,” he said.
Experts added that this increase highlights buyers’ confidence in second-tier cities, aimed at investment and premium living. With overcrowding in Tier-1 cities and dwindling quality housing supply, the next generation of homebuyers are focusing on Tier-2 cities for a modern urban lifestyle, he said.