Housing Sales in 15 Major Tier-II Cities Decline 8% to 43,781 Units in Q1: PropEquity
According to PropEquity, a real estate data analytics firm, housing sales in 15 major tier-II cities declined by 8% to 43,781 units in the first quarter of 2025. However, sales in value terms increased by 6% to ₹40,443 crore.
Housing SalesTierii CitiesPropequityReal EstateRbiReal EstateJun 01, 2025
Real estate data analytics firm PropEquity highlighted that sales in value terms increased 6% to ₹40,443 crore during the first quarter of this calendar year. In the same period of 2024, housing sales in volume stood at 47,378 units while in value terms at ₹38,102 crore.
These 15 tier II cities are Ahmedabad, Surat, Vadodara, Gandhi Nagar, Nashik, Nagpur, Goa, Lucknow, Jaipur, Mohali, Visakhapatnam, Kochi, Coimbatore, Bhopal, and Bhubaneswar. Samir Jasuja, Founder and CEO of PropEquity, said, “The lesser supply in the March quarter resulted in lower sales in tier 2 cities. State capitals performed relatively better.” He added that the demand continues to be strong due to improving physical and social infrastructure.
RBI has made a 50 basis points cut in the repo rate since January 2025 and is expected to cut rates further. As this gets transmitted by banks, home loans will decline going forward, thereby giving a boost to housing demand, Jasuja said.
Lucknow witnessed the maximum 25% increase in the number of units sold in the March quarter at 1,301. This was followed by Coimbatore with a 21% increase, Gandhi Nagar with an 18% increase, and Mohali with a 2% increase. Other 11 cities saw a decline in the number of units sold in Q1 2025, with Visakhapatnam registering the highest decline of 37%.
In value terms, eight cities saw an increase in sales while seven witnessed a decline. Ahmedabad, the biggest market among these 15 cities, saw a 1% decline in sales to 14,583 units from 14,780 units, but sales value grew 7% to ₹13,565 crore from ₹12,730 crore.
Tier-II cities are rapidly emerging as prominent housing markets, driven by expanding corporate presence, employment opportunities, and aggressive infrastructure development. These cities are witnessing a transformation fueled by strategic public and private investments. This has led to a surge in demand and property prices across various micro-markets, according to Mohit Malhotra, Founder & CEO of realty firm NeoLiv.
Yashank Wason, Managing Director of Royal Green Realty, said the rise of tier-II cities such as Indore, Sonipat, and Rohtak as real estate investment hubs can largely be attributed to their advancing infrastructure. “As metropolitan regions face saturation, these cities offer a compelling blend of opportunity and lifestyle, positioning them at the forefront of India's next real estate growth wave,” he added.
Vijay Harsh Jha, founder and CEO of VS Realtors, said the marginal drop in sales volumes is temporary and demand will improve because of strong economic growth and likely reduction in interest rates on home loans.
Frequently Asked Questions
What is the percentage decline in housing sales in 15 tier-II cities in Q1 2025?
Housing sales in 15 tier-II cities declined by 8% to 43,781 units in Q1 2025.
Which city saw the maximum increase in the number of units sold in the March quarter?
Lucknow witnessed the maximum 25% increase in the number of units sold in the March quarter at 1,301 units.
How did Ahmedabad perform in terms of housing sales in Q1 2025?
Ahmedabad, the biggest market among these 15 cities, saw a 1% decline in sales to 14,583 units from 14,780 units, but sales value grew 7% to ₹13,565 crore from ₹12,730 crore.
What factors are driving the growth of tier-II cities as prominent housing markets?
Tier-II cities are rapidly emerging as prominent housing markets, driven by expanding corporate presence, employment opportunities, and aggressive infrastructure development.
What impact is expected from the RBI's repo rate cuts on housing demand?
The RBI has made a 50 basis points cut in the repo rate since January 2025 and is expected to cut rates further. As this gets transmitted by banks, home loans will decline, thereby giving a boost to housing demand.
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