NEWS
Real estate offers strong returns, but buying a home in these 11 non-metro cities is extremely expensive.
Property prices are rising at a rapid pace, doubling by the day and quadrupling by the night. People are increasingly considering property as a viable investment option. Meanwhile, buying property in non-metro cities has become increasingly difficult these days.
Buying property in small towns has become very difficult.
With property prices rising rapidly in India, investors are also investing in them. People living in major cities like Mumbai, Delhi, and Bengaluru often find it difficult to purchase property there. But did you know that buying a home in non-metro cities is even more challenging? This isn't our opinion, but reports suggest otherwise.
What's in the report?
A recent report by CII and Knight Frank found that home prices in 11 emerging cities will increase by an average of 63% between 2021 and 2026. In comparison, prices in the country's eight largest cities have risen by approximately 42%. According to the report, the property market is no longer limited to major cities like Mumbai, Delhi, and Bengaluru, but has also expanded to smaller, emerging cities like Bhopal, Jaipur, Indore, and Lucknow.
According to this report, there
are 11 smaller, non-metro cities where property prices are steadily rising. Here's a look at the price increases in each city:
| City | Price (per sq ft) |
| Goa | Rs 11,500- 13,500 per sq ft |
| Chandigarh Tricity | Rs 7,500- 10,500 per sq ft |
| Jaipur | Rs 7,000- 9,000 per sq ft |
| Kochi | Rs 7,000- 9,000 per sq ft |
| Bhubaneswar | Rs 6,550- 8,550 per sq ft |
| Lucknow | Rs 6,500- 8,500 per sq ft |
| Coimbatore | Rs 6,000- 8,000 per sq ft |
| Indore | Rs 5,500- 7,500 per sq ft |
| Bhopal | Rs 5,000- 7,000 per sq ft |
| Nagpur | Rs 4,500- 6,500 per sq ft |
| Visakhapatnam | Rs 4,500- 6,500 per sq ft |
How much will a house cost?
Based on the rate charts shown in this list, if the price of a house in a city is ₹6,000 per square foot, a 1,000-square-foot house would cost approximately ₹6 million. This excludes registration, taxes, and other expenses. If the price is ₹12,000 per square foot, a house of the same size would cost approximately ₹1.2 crore. Therefore, it's not correct to assume that a property will be cheap just because a city is in Tier 2.
Why are property prices rising?
The biggest reason for rising property prices in smaller cities is the development of infrastructure. The government is spending more money on roads, railways, airports, and other facilities. Infrastructure's share of total capital expenditure is expected to increase from 39% in FY2015 to 55% by FY2026. Improved road, airport, and rail connectivity makes cities easier to access. This could boost business and human movement.
What should you consider when buying property?
However, the decision to purchase property in a city shouldn't be based solely on the fact that prices have risen rapidly in the past. A city with growing infrastructure, employment, business, population, and daily amenities is likely to have a stronger foundation for future residential demand. According to the report, Tier 2 and Tier 3 cities are expected to play a significant role in India's real estate sector in the coming years.
