A Resurgent Boom: How India's Tier-II Cities are Shaping the Future of Real Estate

In 2024, the housing sales in the top 15 cities rose by 4% to 1,78,771 units with sales value rising by 20% to Rs 1,52,552 crore.

Real Estate in India, Real Estate News

India’s real estate sector is witnessing an upward growth trajectory. In 2024, the housing sales in the top 15 cities rose by 4% to 1,78,771 units with sales value rising by 20% to Rs 1,52,552 crore. According to real estate data analytics firm PropEquity, the housing sales stood at 1,71,903 units while the sales value stood at Rs 1,27,505 crore in 2023.

City-Wise Growth

Housing Sales Performance

Housing sales rose the most in Coimbatore at 36% and fell the most in Visakhapatnam at 21% in 2024 while Bhubaneswar recorded the highest growth in sales value at 47% while Nashik recorded a 2% decline in sales value.

Western India – 7 Cities

According to the report, the seven cities in western India saw sales of 1,38,554 units in 2024 as compared to 1,34,031 units in 2023, up 3.4%. The sales value grew by 18% to Rs 1,10,939 crore in 2024. Housing sales were led by Surat with a 15% rise, followed by Gandhi Nagar at 8%, Goa at 5%, Ahmedabad at 4%, and Nagpur at 3%. Housing sales fell in Nashik by 10% and Vadodara by 3%. Only Nashik witnessed a decline in sales value at 2%.

Southern India – 3 Cities

The three cities in southern India saw sales of 10,941 units in 2024 as compared to 10,648 units in 2023, up 2.75%. The sales value grew by 15% to Rs 11,404 crore. Housing sales were led by Coimbatore with a 36% rise followed by Trivandrum at 16%. Sales declined in Visakhapatnam by 21%. Only Visakhapatnam witnessed a decline in sales value at 1%.

Northern India – 3 Cities

Sales in the three cities of Northern India stood at 18,889 units in 2024 as compared to 18,420 units in 2023, up 2.5%. Sales value grew by 23% to Rs 19,127 crore in 2024. Housing sales rose by 5% in Jaipur and 1% in Lucknow while it fell by 1% in Mohali. Sales value grew by 39% in Jaipur, 5% in Lucknow, and 18% in Mohali.

Eastern and Central India – 2 Cities

Housing sales in the two eastern and central Indian cities stood at 10,387 units in 2024 as compared to 8,804 units in 2023, up 18%. Sales value grew by 45% to Rs 11,082 crore in 2024. Housing sales rose 23% in Bhubaneswar and 10% in Bhopal. Sales value grew by 38% in Bhopal and 47% in Bhubaneswar.

Industry Insights

Commenting on the development, Aakash Ohri, Joint MD and Chief Business Officer, DLF Homes, said that the Tier II cities have emerged as significant beneficiaries of the surge in residential demand, particularly those in close proximity to metropolitan centres.

"These locations offer a serene, green, and well-planned lifestyle while providing amenities, security, and investment appreciation on par with metro cities. Luxury developments are no longer confined to metropolitan areas, as both local buyers and those from larger cities are increasingly drawn to high-end residences in smaller cities, especially projects that offer an elevated standard of living without compromising on luxury. Demand spans various purposes, including personal use, second homes, high-value rental opportunities, and short-term leases.

Mohit Malhotra, Founder & CEO of NeoLiv, said that the real estate landscape has experienced remarkable growth, particularly in emerging upcoming growth centres of NCR and MMR.

"Tier-II cities have emerged as strong destinations, offering a strong sense of community, lower living costs, and significant potential for appreciation. Going forward these cities present lucrative opportunities for both homebuyers and investors. With increasing urban migration, infrastructural advancements, and rising demand for premium yet affordable housing, now is the ideal time to invest in these emerging destinations for long-term growth and sustained value," he said.