Property prices jump by 10-15% in tier 2 cities: Report

New Delhi: Property prices have increased by 10-15% in tier 2 cities as soaring economic activity, infrastructure development, and reverse migration are driving double-digit property price appreciation in emerging urban centres, according to Housing.com.

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.


"The real estate narrative of India is evolving rapidly, with Tier-2 cities like Kochi, Jaipur, Goa, and Chandigarh Tri-city 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,” said Dhruv Agarwala, Group CEO of the company.

Homebuyer preferences are shifting towards high-rise apartments and lifestyle amenities like clubhouses, open spaces, and sports facilities.

“Tier-2 cities are no longer on the sidelines; they are becoming major players, attracting investments and offering attractive opportunities," Agarwala said.

Online property searches by potential buyers in the Rs 1-2 crore segment have surged 61%, while the above INR 2 crore bracket has seen a growth of 121%.

“Tier-II cities today are reflecting the preferences of homebuyers that we usually see in major cities with heightened searches for amenity-rich premium homes priced above Rs 2 crore. The search for this price bracket has registered the steepest increase of 121% since the pandemic,” said Ankita Sood, Head of Research at Housing.com.