Suburban Housing Markets in India Overtake Urban Hotspots
Many suburban housing markets in India have outperformed urban hotspots due to their greater potential for price appreciation.
The past few years have witnessed the launch of several luxury projects in these peripheral areas to cater to growing demand. (Image: BNP News)
In a notable trend, peripheral areas in India’s top seven cities have witnessed stronger price growth compared to prime urban locations over the past six years. Recent research by ANAROCK highlights these suburban regions as hotspots for real estate investment, driven by their untapped potential for price appreciation.
For example, the peripheral area of Gunjur in Bengaluru witnessed an impressive 69% rise in average residential prices, escalating from INR 5,030 per sq. ft. in 2019 to INR 8,500 per sq. ft. by the third quarter of 2024. In contrast, the prime area of Thannisandra Main Road recorded a 62% increase during the same timeframe, with prices climbing from INR 5,175 per sq. ft. to INR 8,400 per sq. ft. in Q3 2024.
Commenting on the same, Santhosh Kumar, Vice Chairman of ANAROCK Group, said that in the peripheral region of Noida Expressway in the National Capital Region, average residential prices surged by 66% over the last six years, rising from INR 5,075 per sq. ft. in 2019 to INR 8,400 per sq. ft. in Q3 2024. Meanwhile, the prime area of Raj Nagar Extension experienced a 55% increase, with prices moving from INR 3,260 per sq. ft. in 2019 to INR 5,050 per sq. ft. in Q3 2024. However, this trend is not consistent across all areas. For instance, the prime location of Dwarka Expressway in Delhi saw a remarkable 93% increase in average residential prices, from INR 5,359 per sq. ft. in 2019 to INR 10,350 per sq. ft. in Q3 2024.
Overall, average residential prices have been on the rise across various cities over the past six years. Many peripheral areas in these top cities have outperformed prime locations due to their greater potential for price appreciation, as prime areas had already experienced significant growth in previous years. Additionally, enhanced connectivity and overall development in numerous peripheral regions have contributed to their improved livability.
Kumar further said that the past few years have witnessed the launch of several luxury projects in these peripheral areas to cater to growing demand. Consequently, average housing prices in these regions have increased. With ample land available, developers have focused on launching large, state-of-the-art projects. Enhanced connectivity has made it feasible for buyers to reside in expansive communities featuring ample green spaces, a trend that has gained prominence following the COVID-19 pandemic.
City-Wise Trends: Peripheries vs Prime Locations
| City | Category | Micro Markets | Avg. Residential Prices in INR/Sqft (2019) | Avg. Residential Prices in INR/Sqft (Q3 2024) | Price Change % (2019 Vs Q3 2024) |
| Bengaluru | Peripheral | Gunjur | 5,030 | 8,500 | 69% |
| Prime | Thanisandra Main Road | 5,175 | 8,400 | 62% | |
| NCR | Peripheral | Noida Expressway | 5,075 | 8,400 | 66% |
| Prime | Raj Nagar Extension | 3,260 | 5,050 | 55% | |
| MMR | Peripheral | Panvel | 5,520 | 8,700 | 58% |
| Prime | Worli | 38,560 | 53,000 | 37% | |
| Pune | Peripheral | Wagholi | 4,820 | 6,600 | 37% |
| Prime | Wakad | 6,540 | 8,300 | 27% | |
| Kolkata | Peripheral | Madhyamgram | 3,000 | 4,300 | 43% |
| Prime | Joka | 3,415 | 5,150 | 51% | |
| Chennai | Peripheral | Navalur | 3,955 | 6,080 | 54% |
| Prime | Anna Nagar | 11,650 | 15,780 | 35% | |
| Hyderabad | Peripheral | Kompalli | 4,010 | 5,970 | 49% |
| Prime | Gachibowli | 4,775 | 8,900 | 86% |
Source: ANAROCK Research
* MMR’s peripheral area Panvel saw over 58% price appreciation in the last 6 years – from INR 5,520 per sq. ft. (2019) to INR 8,700 per sq. ft. (Q3 2024). Prime area Worli, on the other hand, saw 37% price growth in this period – from INR 38,560 per sq. ft. (2019) to nearly INR 53,000 per sq. ft. (Q3 2024). Similarly, prime area Lower Parel saw 49% growth, while periphery Virar saw 58% growth. In Lower Parel, avg. prices rose from INR 34,660 per sq. ft. (2019) to INR 51,660 per sq. ft. (Q3 2024). In Virar, prices rose from INR 4,440 per sq. ft. (2019) to INR 6,850 per sq. ft. (Q3 2024).
* Pune’s prime area Wakad recorded 27% price appreciation – from INR 6,530 per sq. ft. (2019) to INR 8,300 per sq. ft. (Q3 2024); periphery Wagholi saw 37% growth between 2019 and Q3 2024. Avg. prices there went from INR 4,820 per sq. ft. (2019) to INR 6,600 per sq. ft. (Q3 2024).
Kolkata’s prime Joka saw prices rise 51% – from INR 3,415 per sq. ft. (2019) to INR 5,150 per sq. ft. (Q3 2024) while peripheral Madhyamgram and Behala saw prices appreciate by 43% and 35% respectively. Prime area Rajarhat saw prices grow by just 29% in the period.
* Chennai’s peripheral area Navalur saw prices grow by 54% in last 6 years – from INR 3,955 per sq. ft. (2019) to INR 6,080 per sq. ft. (Q3 2024). Meanwhile, prime areas like Anna Nagar and T Nagar saw prices appreciate 35% and 31% respectively in this period.
* Bengaluru’s peripheral area of Devanahalli also saw prices grow 49% in the last 6 years – from INR 4,982 per sq. ft. (2019) to INR 7,400 per sq. ft. (Q3 2024). Prime location Electronic City saw just 38% price growth in this period – from INR 4,658 per sq. ft. (2019) to INR 6,450 per sq. ft. (Q3 2024).
* In Hyderabad, prime areas Gachibowli and Kondapur continue to see higher price growth than most peripheral areas like Kompalli, LB Nagar and Tellapur. Gachibowli recorded 86% price growth in the last 6 years – from INR 4,775 per sq. ft. (2019) to INR 8,900 per sq. ft. (Q3 2024). Kondapur also recorded 86% price growth – from INR 4,620 per sq. ft. (2019) to INR 8,600 per sq. ft. (Q3 2024). These prime areas saw higher growth because their base prices were far lower than many of their counterparts in other cities. This boosted the scope for higher appreciation there.
* Likewise, NCR’s peripheral area Sohna saw price growth of 43% – from INR 4,120 per sq. ft. (2019) to INR 5,900 per sq. ft. (Q3 2024) while prime area New Gurugram saw prices appreciate by 59% in the same period.
