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Key Points

In the first quarter of 2025, housing sales in India's top 15 tier 2 cities experienced an 8% decline, according to PropEquity. However, the sales value increased by 6%, indicating a rising preference for higher value properties. Lucknow emerged as the top performer with a 25% rise in units sold, while Visakhapatnam witnessed the steepest fall at 37%. Despite a dip in overall sales, demand remains robust due to urban rejuvenation, and reduced home loan rates are likely to further boost housing demand.

Key Points: PropEquity Reports Tier 2 Cities Housing Sales Dip 8 Percent Q1 2025

  • Tier 2 home sales down 8% but value up 6%
  • Lucknow leads with 25% growth
  • Visakhapatnam sees biggest drop in sales
3 min read

Housing sales in top tier 2 cities fall 8%, sales value up 6% in Q1 2025: PropEquity

Housing sales fall 8% in India's tier 2 cities; sales value sees a 6% rise in Q1 2025.

"Lesser supply resulted in lower sales in tier 2 cities. - Samir Jasuja, PropEquity"

New Delhi, June 1

Housing sales in India's top 15 tier 2 cities fell by 8 per cent to 43,781 units in Q1 2025 as compared to 47,378 units in the same period last year, said a report by NSE-listed real estate data analytics firm PropEquity.

The sales value during the quarter, however, rose by 6 per cent to Rs 40,443 crore in Q1 2025 as against Rs 38,102 crore in the same period last year, the PropEquity report noted.

According to the report, Lucknow with 25 per cent increase in number of units sold in Q1 2025 at 1,301 units registered the highest growth amongst top 15 tier 2 cities.

This was followed by Coimbatore 21 per cent, Gandhi Nagar 18 per cent, and Mohali 2 per cent.

Other 11 cities saw decline in number of units sold in Q1 2025 with Visakhapatnam registering the highest decline (37 per cent) and Ahmedabad and Goa recording the least decline (1 per cent each).

Coimbatore with 52 per cent growth saw the highest increase in sales value at Rs 1,120 crore in Q1, 2025. This was followed by Lucknow at 48 per cent, Gandhi Nagar 36 per cent, Mohali and Goa at 17 per cent each, Ahmedabad and Bhubaneshwar at 7 per cent each and Kochi 5 per cent.

Other 7 cities saw a decline in sales value in Q1 2025 with Visakhapatnam recording the highest decline (35 per cent) and Vadodara and Nagpur registering the least decline (1 per cent each).

Samir Jasuja, Founder and CEO, PropEquity said, "The decline in sales in tier 2 cities in January-March period is in line with trends witnessed in tier 1 cities. However, lesser supply in this quarter resulted in lower sales in tier 2 cities. State Capitals performed relatively better."

"Demand in tier 2 cities, however, remains robust as people have shown greater preference for organised living. Urban rejuvenation efforts, improved connectivity and social infrastructure, and more importantly greater employment opportunities mainly in IT and new manufacturing hubs in tier 2 cities have further accelerated demand not only from within but also from people who have migrated to metro cities and are preferring to purchase property in their hometowns. RBI has made 50bps cut in repo rate since January 2025 and is expected to cut rates further. As this gets transmitted by banks, homes loans will decline going forward thereby giving a boost to housing demand," Jasuja added.

The six State Capitals in top 15 tier 2 cities, namely Gandhi Nagar, Jaipur, Bhubaneshwar, Lucknow, Goa and Bhopal, saw 5 per cent decline in sales and 17 per cent increase in sales value, accounting for 25 per cent of sales and 30 per cent of sales value in Q1 2025, as per the PropEquity report.

- ANI

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Reader Comments

R
Rahul K.
Interesting to see Lucknow and Coimbatore leading the growth charts! 🏙️ As someone from UP, I can confirm there's massive infrastructure development happening in Lucknow. The new expressway and IT parks are making it attractive for both investors and end-users. But 37% drop in Vizag is concerning - any insights on why?
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Priya M.
The numbers show that while fewer units are being sold, the overall value is increasing. This suggests builders are focusing on premium projects in tier 2 cities now. As middle-class buyers, we're getting priced out of good locations. Government should incentivize affordable housing more strongly in these markets.
A
Arjun S.
Coimbatore's 52% growth in sales value is phenomenal! Being from Tamil Nadu, I've seen how the city has transformed into an education and healthcare hub. Many NRIs are investing here for retirement homes. But developers need to ensure quality matches the price hikes we're seeing.
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Sunita R.
The report mentions RBI rate cuts but banks are very slow in passing benefits to customers. My home loan EMI has reduced by only ₹500 despite two rate cuts! If transmission improves, we might see better sales numbers next quarter. Also, why no data on Chandigarh? It's a major tier 2 market.
V
Vikram J.
As a real estate agent in Ahmedabad, I can say the 1% decline doesn't tell the full story. While ready inventory is moving slowly, pre-launch projects in new areas like GIFT City are seeing record bookings. The market is shifting, not shrinking. Developers need to adapt to changing buyer preferences.
N
Neha P.
The work-from-home culture is definitely boosting tier 2 city real estate. Many of my colleagues in Bangalore are buying properties in their hometowns as backup options. But infrastructure (especially internet reliability) needs to improve further to sustain this trend long-term.

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