News: Square Yards: Tier-2, Tier-3 Land Values May Rise 25-100%-11-03-2026
Land prices in select corridors of Tier-2 and Tier-3 cities could climb by 25% to 100% over the next two to four years on the back of a sustained infrastructure push, according to a report by proptech firm Square Yards titled ’Realty’s next growth engines: Tier-2, Tier-3 markets in focus’.
The forecast follows Budget 2026. On February 1, Finance Minister Nirmala Sitharaman proposed City Economic Regions (CERs), with Rs 5,000 crore per region over five years to implement development plans through a ’challenge mode’.
The report breaks down the likely effect by type of infrastructure. Properties within 500 metres to 1 kilometre of metro corridors typically carry a premium of 8-25%, and corridor-level appreciation is around 15-40% after completion. Airports and expressways can produce stronger early gains, with prices in their influence zones rising 30-70% between announcement and completion. In high-growth peripheral micro-markets, particularly plotted developments and land parcels, multi-year appreciation could exceed 80-100%. Industrial corridors and logistics hubs backed by employment centres are expected to lift land values by roughly 20-60%. Land, the report says, reacts more sharply than stabilised housing segments.
It names Bhubaneswar (Rs 4,000-Rs 8,000 per sq ft), Cuttack (Rs 2,000-Rs 7,000 per sq ft), Erode (Rs 1,600-Rs 6,000 per sq ft), Puri (Rs 5,500-Rs 10,500 per sq ft), Varanasi (Rs 4,000-Rs 8,000 per sq ft) and Visakhapatnam (Rs 3,000-Rs 8,000 per sq ft) as markets likely to lead the next growth cycle.
Demand in these cities comes mainly from salaried end-users, not investors. Homes of Rs 30 lakh to Rs 60 lakh draw first-time buyers, the Rs 60 lakh to Rs 1 crore band serves core mid-segment buyers, and Rs 1 crore to Rs 1.5 crore properties attract aspirational buyers. Plotted developments are also seeing strong traction.
More broadly, the report says residential real estate is entering a structurally supported expansion, backed by Rs 12.2 lakh crore in planned public capital expenditure, employment growth and improving financial stability. It sees a move away from speculative, liquidity-driven cycles towards employment-backed demand, which should strengthen mid-income housing, particularly in the Rs 50 lakh to Rs 1 crore range. Macroeconomic stability and moderation in the repo rate are improving mortgage affordability for the salaried class.
The revival of more than 200 legacy industrial clusters, Semiconductor Mission 2.0 and expansion in electronics, chemical and advanced manufacturing are expected to generate large-scale employment, supporting housing absorption in emerging cities as well as demand for offices, logistics hubs and warehousing.
Tanuj Shori, CEO and co-founder, Square Yards, said residential demand will increasingly follow job creation as infrastructure and industry spread to new regions. With Tier-1 cities now largely saturated, he said, opening new growth territories is essential to sustain activity in the country’s second-largest employment-generating sector.
Sunita Mishra, vice-president, Research and Insights, Square Yards, said Budget measures and planned investments such as the recently announced Urban Challenge Fund would unlock the industrial and commercial prospects of these cities, and called it an opportunity for buyers and investors seeking mid- to long-term appreciation.
