Tier-2 Cities Closing the Gap with Top-8 as Property Prices Surge by 10-15 percent in Prime Areas: Housing.com’s The Bharat in India Report

Tier-2 Cities Closing the Gap with Top-8 as Property Prices Surge by 10-15 percent in Prime Areas: Housing.com’s The Bharat in India Report

Mumbai, 14th June 2024 – Housing.comIndia’s leading full-stack proptech company, has released its inaugural “The Bharat in India” report today. The report unveils remarkable growth trends in Tier-2 city real estate markets across the country. It highlights how these once overlooked urban centers are rapidly closing the gap with their Tier-1 counterparts. This growth is fueled by economic diversification, rising consumer demand, and reverse migration patterns accelerated by the pandemic.

According to Mr. Dhruv Agarwala, Group CEO of Housing.com said, “The real estate narrative of India is evolving rapidly, with Tier-2 cities like Kochi, Jaipur, Goa, and Chandigarh Tricity emerging as new growth powerhouses. Our proprietary Property Buy Index reveals Tier-2 cities surpassing the top eight metros by a staggering 88 points, underscoring their increasing prominence and service sector potential.”

S.No. City Average Capital Values (INR/sq ft)
1 Bhopal 3,000-5,000
2 Chandigarh 8,000-10,000
Mohali 7,000-9,000
Zirakpur 7,000-9,000
3 Coimbatore 5,500-7,500
4 North Goa 10,000-12,000
South Goa 6,000-8,000
5 Jaipur 4,000-6,000
6 Kochi 6,000-8,000
7 Lucknow 5,000-7,000
8 Nagpur 4,000-6,000
9 Nashik 3,000-5,000
10 Vadodara 3,000-5,000

Key highlights from “The Bharat in India” report:

  • Key micro-markets in Tier-2 cities have witnessed significant double-digit capital value appreciation of 10-15% year-on-year, narrowing the price gap with top metros.
  • Capital values in premium localities of Goa, Chandigarh Tricity, and Kochi are now almost at par with key markets in Delhi-NCR and Mumbai Metropolitan Region.
  • Tier-2 cities like Goa boast robust rental markets with yields as high as 8%, in contrast to 2-3% in major metros.
  • Homebuyer preferences are shifting towards high-rise apartments and lifestyle amenities like clubhouses, open spaces, and sports facilities.
  • Online property searches by potential buyers in the INR 1-2 crore segment have surged 61%, while the above INR 2 crore bracket has seen a growth of 121%.

“The economic kaleidoscope is shifting, and Tier-2 urban clusters are emerging as new magnets for the skilled workforce and the start-up ecosystem. This report paints a compelling picture of India’s evolving real estate landscape and underscores the immense opportunities that lie ahead for investors, developers, and homebuyers looking beyond the traditional real estate hotspots. Tier-2 cities are no longer on the sidelines; they are becoming major players, attracting investments and offering attractive opportunities,” Mr. Agarwala added.