Tier II and III Cities Expected to Drive Next Phase of Housing Growth in India
- brg_news_room
- 2 days ago
- 1 min read
India: Square Yards stated in a recent report that Tier II and Tier III cities are likely to drive the next growth cycle in the Indian housing market as rising property prices in major metropolitan areas have affected affordability. According to the report titled India's Next Real Estate Growth Cycle: The Rise of Tier 2 and Tier 3 Cities, housing prices increased significantly between 2022 and 2024 in major cities including the Mumbai Metropolitan Region, Pune, Bengaluru, Delhi NCR, Hyderabad, Chennai, and Kolkata, reducing affordability due to higher price growth compared with income levels and limited supply of affordable and mid-income housing.
The report noted that emerging cities are offering relatively lower property prices and improved price to income alignment, which is supporting residential demand from end users. Cities such as Bhubaneswar, Cuttack, Erode, Puri, Varanasi, and Visakhapatnam are expected to contribute to the next phase of housing demand. The analysis indicates that residential growth during the 2026 to 2028 period will be supported by employment expansion in smaller cities and relatively better housing affordability compared with Tier 1 markets.
Source: The Economic Times
