PropEquity presents a comprehensive analysis of tier 2 cities across India, encompassing over 1,73,000 projects in 44 cities. This unique study sheds light on the real estate dynamics often overlooked by mainstream analyses. The research evaluates these cities on six critical parameters over a 5-year period, from FY 2019-2020 to FY 2023-2024, offering a deep dive into market trends and performance metrics.
The report underscores the significant real estate transactions in tier 2 cities, amounting to approximately ₹4.87 lakh crores over the last five years. This figure represents 25% of the transactions seen in tier 1 cities, highlighting the growing investment potential in these emerging urban centers.
Each city has been meticulously assessed based on criteria such as new project launches, price appreciation, absorption rates, supply changes, sales trends, and project completions. This methodological approach provides a comprehensive view of the real estate landscape, enabling investors and stakeholders to make informed decisions.
The findings reveal intriguing insights, including unexpected placements of cities in the top 10 rankings. Notably, several state capitals expected to lead did not make the cut, while lesser-known cities demonstrated robust growth driven by infrastructure developments and employment opportunities.
Here are details of each city.
- Goa
- Price Appreciation: 90% over the last 5 years.
- Current Weighted Average Price: ₹10,219 per sq.ft.
- Average Prices: ₹1 crore for a 1,200 sq.ft. 2-bedroom apartment, ₹2 crore for a 1,600 sq.ft. 3-bedroom apartment.
- Key Factors: Known for tourism and economic resilience.
- Infrastructure Boost: Inauguration of Mopa International Airport in 2022 contributed significantly.
- Nagpur
- Price Appreciation: 51% over the last 5 years.
- Current Weighted Average Price: ₹7,994 per sq.ft.
- Average Prices: ₹96 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹1.28 crores for a 1,600 sq.ft. 3-bedroom apartment.
- Key Factors: Infrastructural advancements such as Metro Phase 1 and Samruddhi Mahamarg Expressway.
- Economic Growth: Emerging as a key hub in Maharashtra.
- Mangalore
- Price Appreciation: 54% over the last 5 years.
- Current Weighted Average Price: ₹7,527 per sq.ft.
- Average Prices: ₹90 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹1.2 crores for a 1,600 sq.ft. 3-bedroom apartment.
- Key Factors: Strategic location, petrochemical industry hub.
- Industrial Investments: Significant real estate activity due to industrial growth.
- Trivandrum
- Price Appreciation: 57% over the last 5 years.
- Current Weighted Average Price: ₹6,621 per sq.ft.
- Average Prices: ₹80 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹1.05 crores for a 1,600 sq.ft. 3-bedroom apartment.
- Key Factors: IT prowess anchored by Technopark.
- Employment Generation: Home to over 480 companies employing a substantial workforce.
- Surat
- Price Appreciation: 25% over the last 5 years.
- Current Weighted Average Price: ₹4,027 per sq.ft.
- Average Prices: ₹48 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹64 lakhs for a 1,600 sq.ft. 3-bedroom apartment.
- Key Sectors: Diamond and textile industries.
- Economic Growth: Prominent center for textile and garment industry.
- Vadodara
- Price Appreciation: 52% over the last 5 years.
- Current Weighted Average Price: ₹3,856 per sq.ft.
- Average Prices: ₹46 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹62 lakhs for a 1,600 sq.ft. 3-bedroom apartment.
- Key Sectors: Manufacturing sectors including power equipment, defense, and IT.
- Economic Drivers: Presence of large-scale industries and oil refineries.
- Nashik
- Price Appreciation: 50% over the last 5 years.
- Current Weighted Average Price: ₹6,246 per sq.ft.
- Average Prices: ₹75 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹1 crore for a 1,600 sq.ft. 3-bedroom apartment.
- Key Factors: Wine capital of India, part of the Golden Economic Triangle.
- Economic Growth: Significant boost in organized office spaces and industrial sectors.
- Bhubaneswar
- Price Appreciation: 58% over the last 5 years.
- Current Weighted Average Price: ₹7,361 per sq.ft.
- Average Prices: ₹88 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹1.17 crores for a 1,600 sq.ft. 3-bedroom apartment.
- Key Sectors: IT, SEZs, electronic manufacturing, and handicrafts industries.
- Infrastructure Projects: Infocity SEZ, Electronic Manufacturing Cluster, and upcoming projects driving economic activities.
- Gandhinagar
- Price Appreciation: 50% over the last 5 years.
- Current Weighted Average Price: ₹4,501 per sq.ft.
- Average Prices: ₹54 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹72 lakhs for a 1,600 sq.ft. 3-bedroom apartment.
- Key Sectors: Small and medium scale industries, proposed Ahmedabad-Gandhinagar Metro corridor.
- Infrastructure Development: Growth in industrial and commercial sectors with projects like Infocity contributing to economic growth.
- Ahmedabad
- Price Appreciation: Over 60% over the last 5 years.
- Current Weighted Average Price: ₹4,628 per sq.ft.
- Average Prices: ₹55 lakhs for a 1,200 sq.ft. 2-bedroom apartment, ₹75 lakhs for a 1,600 sq.ft. 3-bedroom apartment.
- Key Sectors: Textile manufacturing, Gujarat International Finance Tec-City (GIFT City).
- Infrastructure: GIFT City, India's first international financial services center, driving economic activities and real estate demand.
This structured overview provides a comprehensive insight into the performance and potential of each tier 2 city, highlighting their unique economic drivers and infrastructure developments influencing their real estate markets.
