Mumbai: Housing sales in the top 15 tier-2 cities declined 10% year-on-year in 2025 to 1,56,181 units, even as total sales value remained flat at ₹1.48 lakh crore, according to data released by PropEquity.
The report indicates that rising housing prices and growing premiumisation impacted volumes across most tier-2 cities. Except for Mohali and Lucknow, which recorded 34% and 6% growth respectively, the remaining 13 cities witnessed a decline in sales, with Visakhapatnam registering the sharpest fall of 38%.
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The data highlights a structural shift in buyer preference and pricing trends. Homes priced below ₹1 crore saw a 15% year-on-year drop in sales volume in 2025, with their share reducing to 72% from 77% in 2024. In contrast, homes priced above ₹1 crore recorded a 9% growth, increasing their market share to 28%.
Ahmedabad continued to dominate tier-2 housing sales, accounting for 33% of total absorption with 51,148 units sold in 2025. Collectively, the four Gujarat cities—Ahmedabad, Gandhinagar, Vadodara and Surat—contributed 63% of total sales across the top 15 tier-2 cities.
Samir Jasuja, Founder and CEO of PropEquity, said, “The slowdown in housing sales over the past two years is largely due to shrinking supply in the sub-₹1 crore segment, which has traditionally driven demand in tier-2 cities. Rising land and construction costs, along with changing buyer aspirations, are pushing new launches into higher price brackets.”
He added, “Government focus on tier-2 cities through improved connectivity, urban development initiatives and industrial corridors has supported price appreciation. However, as average ticket sizes move beyond ₹1 crore, affordability pressures could begin to impact both mid-income and premium housing segments.”
On the supply side, new launches across the top 15 tier-2 cities declined 6% to 1,36,243 units in 2025, compared to 1,45,139 units in 2024. Supply of homes priced below ₹1 crore fell 5%, while launches above ₹1 crore declined 8%.
Mohali (108%), Bhopal (66%), Ahmedabad (3%) and Jaipur (2%) recorded growth in new supply, whereas Bhubaneswar saw the steepest contraction at 57%. Gujarat’s four key cities accounted for 64% of total launches during the year.
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The data suggests that while sales value in tier-2 cities remains stable, declining volumes and affordability concerns could shape housing demand trends in 2026.
