Top Real Estate Developers Highlight Growth of Tier 2 and Tier 3 Cities in India

New Delhi / September 24, 2025: India’s urban landscape is rapidly transforming due to the expansion of Tier 2 and Tier 3 cities. According to leading real estate developers, these emerging urban centers are becoming important drivers of progress, offering a cost-effective alternative to overcrowded Tier 1 cities.

Over the past decade, many of these smaller towns have evolved into vibrant hubs, attracting businesses and residents as living costs rise in major cities. The surge in job opportunities, driven by a growing digital economy, has made these cities appealing for businesses seeking lower operational costs and access to a skilled workforce, they added. 

Government initiatives like the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and the Smart Cities Mission have further boosted infrastructure development, creating a more favorable business environment. Improved amenities, recreational facilities, and educational institutions are enhancing the quality of life in these regions.

Moreover, a trend of professionals migrating from Tier 1 cities to smaller urban areas for better work-life balance is contributing to their growth. As demand for housing and commercial properties increases, real estate developers are investing heavily in modern workplaces and residential projects, fundamentally reshaping the urban landscape of Tier 2 and Tier 3 cities, they said. 

Mohit Goel, Managing Director Omaxe Ltd said, “A key component affecting the country’s overall growth and economic growth in India is the real estate sector. Tier 2 and 3 cities gradually change into urban centers as urbanization picks up speed, pushing the real estate story. Due to increased connectivity and improved facilities, integrated growth enhances the quality of life for companies and residents in places like Ludhiana, Chandigarh, Lucknow, Vrindavan, Indore and many more. Property values in many cities have risen as a result of this boom, significantly boosting the housing sector. Additionally, these cities are becoming desirable places to invest in real estate because of government programs like the Smart City Mission. As developers, we are excited to contribute to the progress of tier 2 and tier 3 cities, fulfilling their potential.”

Romi Garg, Director, Pebble Downtown Mall said, “Faridabad’s rapid growth as a Tier 2 city is evolving owing to its infrastructure and strategic connectivity to Delhi-NCR. The expansion of road networks, metro extensions, and upcoming projects like the Jewar airport are transforming the region into a premier real estate destination. This growth trajectory unveils significant opportunities for both residential and commercial development. Hence, we foresee promising real estate growth in the city and look forward to contributing to it in progress.”

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Prateek Mittal, Executive Director of Sushma Group, says, “The real estate sector has witnessed a boom in Tier 2 and Tier 3 cities, especially after the recent government policies and announcements. The growth of Tier 2 and Tier 3 cities has contributed substantially to the housing industry. With a rise in demand, real estate developers are making heavy investments in residential and commercial projects. The advent of modern workplaces, shopping malls, and housing complexes has changed the urban face of these cities beyond imagination.”

Manit Sethi, Director, Excentia Infra said, “The rapid transformation in the tier 2 and 3 cities is reshaping the real estate sector, offering compelling opportunities to buyers and investors. As urbanization speeds up and buyer’s lifestyle evolves, these cities are experiencing an increasing demand for luxury housing. The emergence of modern infrastructure and improved quality of life further boosted their economic growth. Notably, cities like Dehradun are becoming attractive locations, boasting a gamut of luxury housing options with enhanced connectivity. Thus, with the growing demand for premium housing in these cities, we anticipate a comprehensive growth for the realty sector in the region.”