Premium Dreams, Tier 2 Scenes: India’s Non-Metros Outshine with Rising Real Estate Fortunes

Image Source: The Economic Times

India's top 15 tier 2 cities have delivered an impressive real estate performance during Q1 2025, as the value of houses sold in these cities stood at ₹40,443 crore, a 6% year-on-year rise—against sales numbers falling 8% to 43,781. It is a clear sign of a tipping point towards premium housing and price appreciation in these high-growth cities.

Key Highlights:

- Higher Sales Value, Lower Volumes:
-Sales value increased 6% to ₹40,443 crore in Q1 2025 (compared to ₹38,102 crore year ago), unit sales fell 8% to 43,781 units.
-The value appreciation in spite of reduced sales is a sign of increased house prices and a bias towards upper-end housing.

Regional Leaders:

-Lucknow recorded the largest sales growth in units, at 25% (1,301 units sold), followed by Coimbatore (+21%), Gandhi Nagar (+18%), and Mohali (+2%).
-Coimbatore topped the sales value growth at 52% (₹1,120 crore), followed by Lucknow at 48%, Gandhi Nagar at 36%, Mohali and Goa at 17% each.
-Visakhapatnam saw the highest drop in units sold (-37%) and value of sales (-35%).

State Capitals Stronger

Six state capitals (Bhopal, Goa, Jaipur, Bhubaneshwar, Lucknow, Gandhi Nagar) experienced a 5% decline in units sold but a robust 17% rise in sales value, accounting for 30% of the total sales value of Q1.

Drivers of Demand:

-There is high demand, fueled by improved infrastructure, systematized living preferences, and manufacturing and IT job growth.
-Many buyers are returning to metros to invest in their hometowns in the hope of good living and value.

Market Outlook:

Experts are seeking additional expansion as banks transmit recent RBI rate reductions, increasing affordability and hopefully boosting housing take-up over the coming few quarters.

Source: The Economic Times, Hindustan Times, Financial Express