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Created By: Shivalik Institute of Real Estate
For years, when people thought about real estate in India, their minds immediately jumped to metro cities like Mumbai, Delhi, or Bangalore. It made sense, these cities had the jobs, the infrastructure, and the demand. But now? The tide is turning. Smaller cities are stepping into the spotlight, and investors are paying attention.
It’s not just hype. Property prices in major cities have skyrocketed, making homeownership a challenge for many. Meanwhile, Tier-2 and Tier-3 cities offer more space, better affordability, and thanks to improving infrastructure accessibility that wasn’t there a decade ago.
The Land Rush: Where Developers Are Placing Their Bets
As per research report on the real estate sector of 60 Indian cities, released by CREDAI-Liases Foras during the New India Summit 2025 in Nashik, Maharashtra, a major revelation came to light. Real estate developers aren’t just focusing on the usual metro hubs anymore. In 2024 alone, 3,294 acres of land changed hands, and the real shocker? 44% of it was in smaller cities.
Why?
Well, land is cheaper, more available, and perfectly positioned for India’s next wave of urban expansion. Cities like Indore, Surat, and Lucknow are no longer just growing but they’re becoming economic powerhouses in their own right.
Housing Sales: More Homes, Bigger Demand
If you think the real estate market is slowing down, think again. In 2024, over 681,000 homes were sold across 60 cities, a 23% increase from the previous year. And get this the total sales value? A massive ₹7.5 trillion, up 43% YoY.
But here’s what’s surprising. It’s not just affordable homes driving the boom. Luxury and ultra-luxury segments are seeing record sales. Homes priced between ₹1-2 crore saw a 52% jump, while the ultrapremium category (₹2 crore and above) skyrocketed by 73%.
What’s Fuelling This Shift?
Several key factors are turning smaller cities into real estate goldmines:
Infrastructure Growth: New highways, metro networks, and airports are connecting once-remote cities to major business hubs.
More Affordable Living: A home in Bangalore might cost a fortune, but in a city like Coimbatore? You get more space for much less.
Remote & Hybrid Work Trends: With flexible work options, people don’t need to stay in expensive metro cities anymore.
Government Incentives: Policies like reduced stamp duty and tax benefits are making smaller-city investments even more appealing.
So, What’s the Future?
This isn’t just a short-term shift—it’s a long-term transformation. As infrastructure improves and demand rises, Tier-2 and Tier-3 cities will become real estate hotspots. Developers and investors who recognize this now will be ahead of the curve.
If you’re thinking about investing, it might be time to look beyond the metros. Because the cities that were once overlooked? They’re now the ones leading the way.
