Tier-II cities including Ahmedabad, Vadodara, Nashik, Gandhi Nagar and Jaipur have emerged as the top five of their kind with regards to the growth of the residential property industry on back of urbanisation, industrialisation and growth of the IT industry, a report has found out.
According to the report by PropEquity titles ‘Tier-II: Residential Overview’, the residential real estate market size of Ahmedabad stands at Rs 83,390 crores, surpassing some tier I cities like Chennai and Kolkata with market sizes of Rs 52,554 crore and Rs 38,440 crores respectively during FY2021-22
“The real estate activity in tier 2 cities is fast catching up with that of tier 1 cities. Interestingly, Ahmedabad’s residential real estate market size of Rs 83,390 crores has outshone some of the Tier 1 cities like Chennai and Kolkata with market sizes of Rs 52,554 crore and Rs 38,440 crores respectively at the end of fiscal year 2021-22. It is 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 at PropEquity.
The report further said that a surge in absorption and supply of quality residential properties across price brackets has taken place in these cities between FY18 and FY22.
“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 next couple of years. This had led to scenario where tier 2 city housing projects are getting traction due to their attractive pricing and potential for a higher upside in terms of investments,” said Abhishiekh Andlay, founder, Andlay Estates.
Total sales value of Tier 1 cities in the last five years from FY 2017-18 to FY 2021 –22 was Rs 12.21 lakh crore while the same in case of Tier 2 cities was Rs 3.14 crore, said the report.
Tales of homes in Ahmedabad stood at 39,046 units in fiscal year 2021-22, a growth of 26 per cent as compared to financial year 2020-2021. When compared to fiscal 2017-18, a growth of 32 per cent was witnessed in the city. The supply of homes in Ahmedabad stood at 39,195 units in financial year 2021-22, a growth of 14 per cent as against fiscal year 2020-2021.
Meanwhile, Vadodara, ranked second, witnessed a growth of 25 per cent in sales of homes at 17,285 units in fiscal 2021-22 as compared to the previous fiscal. When compared to the financial year 2017-18, a jump of 20 per cent was seen.
Third-ranked Nashik witnessed sales of 10,806 units in fiscal 2021-22, a growth of 15 per cent on year-on-year basis. New supply of homes in Nashik stood at 13,037 units in 2021-22 fiscal, a whopping growth of 68 per cent as compared to the previous fiscal.
Gandhinagar saw sales of 7,650 units in fiscal 2021-22, a growth of 10 per cent as compared to the previous fiscal. New supply of homes in Gandhi Nagar stood at 6,361 units in the financial year 2021-22, a drop of 30 per cent on a year-on-year basis.
In Jaipur, 7,676 units were sold in fiscal 2021-22, which is a growth of 42 per cent as compared to the previous fiscal. New supply of homes in Jaipur stood at 7,022 units in the financial year 2021-22, a massive increase of 78 per cent on a year-on-year basis.