Ahmedabad Ascends to Tier-1 Status: ₹1.48 Lakh Crore Tier-2 Housing Market Shifts Towards Premium Properties
India’s real estate market in Tier-2 cities underwent significant changes in 2025. High demand for expensive homes has altered buyer behavior. The total real estate sales in Tier-2 cities reached approximately ₹1.48 lakh crore. However, due to rising prices, the number of homes sold dropped by nearly 10 percent.
According to a PropEquity report, Ahmedabad has emerged as a new real estate powerhouse. Strong demand and supply numbers helped Ahmedabad move ahead of the Tier-2 category and enter the Tier-1 city league.
Some cities experienced sharp declines in home sales. Visakhapatnam recorded the biggest fall of 38 percent. Bhubaneswar saw a 25 percent drop, while Vadodara recorded a 19 percent fall.
However, Mohali and Lucknow performed better. Mohali saw sales grow by 34 percent, while Lucknow saw a 6 percent increase.
The housing market is slowly shifting towards expensive homes. Sales of houses priced below ₹1 crore fell by 15 percent. Their market share dropped from 77 percent in 2024 to 72 percent in 2025.
At the same time, homes priced above ₹1 crore saw a 9 percent rise in sales. Their market share increased from 23 percent to 28 percent. This indicates that buyers are now more interested in premium properties.
By early 2026, Ahmedabad is now being seen as a Tier-1 city. In both new project launches and home sales, Ahmedabad has performed better than many established Tier-1 cities. Strong infrastructure growth and high housing demand have facilitated this transition.
New housing supply in the top 15 Tier-2 cities fell by 6 percent in 2025. Around 1.36 lakh units were launched compared to 1.45 lakh units in 2024. Supply dropped across all price categories. Affordable housing supply fell by 5 percent, while premium housing supply dropped by 8 percent.
Gujarat continued to dominate real estate launches. Four cities—Ahmedabad, Vadodara, Surat, and Rajkot—contributed 64 percent of total housing launches in 2025.
Experts say young buyers are now moving to smaller cities due to better lifestyle, infrastructure, and connectivity. Cities like Indore and Bahadurgarh are becoming popular housing choices.
