2021 marked massive growth for the real estate sector in tier ii and tier iii cities. The pandemic created trends such as work-from-home, reverse migration, e-schooling, the desire to stay close to family, and the rising entrepreneurial spirit that were turned into opportunities by the residential real estate sector effectively. The success of tier ii cities in real estate is reflected by the increased demand and industry reports.
After the pandemic, there has been a rise in demand for property in non-metro cities. Vadodara, Gandhi Nagar, Ahmedabad, Nashik, and Jaipur have taken the top five positions among tier ii cities that have seen a surge in the residential property market. A few drivers of the growth in these cities are infra- development, premium lifestyle offerings, and affordability.
These locations now offer excellent connectivity, and world-class infrastructure all in an affordable price range, leading to an opportune time for development in these regions. The reasons behind the increasing demand for housing demands in tier ii and iii cities is the desire for an avant-garde lifestyle, the shift in priorities, and evolved buying preferences.
In the coming year, these emerging markets will become the center of real estate growth. The preferences of consumers have changed. Aspiring homebuyers today are looking for homes that have modern amenities, and offer large open spaces, balconies, play areas, ample parking space, and vibrant greenery.
Also, flexible work policies due to the pandemic have encouraged them to look for residents in their hometowns. The demand-supply ratio in the real estate industry has now improved significantly. The government has focused on infrastructural development in the country, mainly in tier II cities.
Development of industrial corridors, SEZs, expansion of metros and railway projects, airports, and start-ups are increasing the real estate values in these regions. The setting-up and relocation of many IT hubs and manufacturing industries have also played an important role in accelerating the growth of residential real estate in these areas. The shift of a significant number of corporates and working professionals to these areas will boost the demand for gated communities and integrated townships.
Adding to this low-interest rates on home loans, supportive government policies, and rising disposable income have also increased the demand for housing lately. Reports have shown a 47% increase in housing sales compared to the last year across the top 7 cities.
The coming year will be a boon for the real estate market. The sentiments in the market are improving and a conducive ecosystem for the growth of the industry is being created by favorable factors. According to the experts by 2030 real estate’s contribution to GDP will go up by 10%, contributing about $1 trillion to the economy.