Tier-II cities emerge as growth drivers for residential realty

Ahmedabad, Vadodara, Nashik, Gandhinagar and Jaipur have taken the top five places among Tier-II cities in growth of the residential property market on the back of rapid urbanisation, industrialisation and growth of IT industry, according to a report by PropEquity. The report, titled ‘Tier-II: Residential Overview’, states that there has been a remarkable jump in both absorption as well as supply of quality residential properties in various price brackets in these cities. The report has tracked performance of the residential segment of the real estate sector in various Tier-II cities from FY 2017-18 to FY 2021-22. “The real estate activity in Tier II cities is fast catching up with that of Tier I cities. Interestingly, Ahmedabad’s residential real estate market size of Rs 833.90 billion has outshone some of the Tier 1 cities like Chennai and Kolkata with market sizes of Rs 525.54 billion and Rs 38440 billion respectively, at the end of fiscal year 2021-22. Although it is also interesting to observe that the market share of Tier-I cities is about 4x times the share of Tier-II cities in the last five fiscal years,” said Samir Jasuja, founder and managing director of PropEquity. “Post Covid lockdowns, Tier 2 cities have been witnessing new job creation at a decent rate and many tech and other sector companies are encouraging work from home for their employees for at least the next couple of years. This has led to scenarios where Tier 2 city housing projects are getting great traction due to their attractive pricing and potential for a higher upside in terms of investments,” said Abhishiekh Andlay, founder, Andlay Estates. See also: Casagrand forays into residential constructionDDA-RERA tussle ends as 18 projects get registered