India’s real estate market is witnessing a significant shift beyond its traditional metropolitan centres, with residential property prices across 11 emerging cities rising 63% between 2021 and 2026. The growth compares with a 42% increase recorded across the country’s top eight cities, according to a joint report by the Confederation of Indian Industry (CII) and Knight Frank India.
The 11 markets identified in the report include Bhopal, Bhubaneswar, Chandigarh Tricity, Goa, Indore, Jaipur, Kochi, Lucknow, Nagpur, Visakhapatnam and Coimbatore. Between 2016 and 2026, these cities recorded an average residential price CAGR of 8%, compared with 4% across the top eight cities.
Several factors are supporting this growth, including improving infrastructure, expanding employment opportunities, stronger services sectors, MSME activity and growing connectivity. Government infrastructure spending has also increased, with infrastructure accounting for 55% of total government capital expenditure in FY26, up from 39% in FY15.
The growth is not limited to housing. Key Tier-2 markets recorded 11.2 million sq ft of warehousing transactions in 2025, while 24 Tier-2 cities accounted for 36 million sq ft of organised retail space.
The report projects India’s real estate output could reach $5.8 trillion by 2047, with Tier-2 and Tier-3 cities potentially contributing 25–30% of that output.
