Tier-2 cities see housing prices rise nearly twice as fast as top 8 markets: Report
Residential prices in eleven emerging Tier-2 Indian cities have grown significantly faster. These smaller markets are now driving India's next phase of real estate expansion. Infrastructure development and rising consumption are supporting this accelerated price growth. Commercial activity is also expanding across these developing urban centers. Tier-2 and Tier-3 cities are projected to…
Residential property prices in India's Tier-2 cities have been expanding at a nearly twice the rate of the top eight markets over the last decade, according to a recent CII-Knight Frank India report. The 11 emerging cities studied, including Bhopal, Bhubaneswar, and Jaipur, experienced an average residential price compound annual growth rate of 8% between 2016 and 2026, compared to just 4% in the top eight markets like Mumbai, Delhi-NCR, and Bengaluru.
The fastest price growth occurred between 2021 and 2026, with the emerging markets seeing a 63% rise in prices, while the top eight markets grew by 42%. This disparity is expected to continue, with India's real estate sector projected to reach $5.8 trillion by 2047, with Tier-2 and Tier-3 cities contributing 25-30% of the total, or $1.4-1.7 trillion.
The growth rate is attributed to stronger economic fundamentals, improved infrastructure and connectivity, and rising consumer demand.
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