In some senses, it's both. On the one hand, Faustus's damnation is tragic because he could've been a great man without having to sell his soul to Lucifer. There was simply no need for it. But because he was so full of hubris and so deeply dissatisfied with his many God-given gifts, Faustus entered into a diabolical pact that led to the damnation of his mortal soul for all eternity.
The downfall of an essentially noble character was considered an important element of classical tragedy, and that's definitely what's happened in the case of Faustus. His story is that of a potentially good life wasted. And if that isn't tragic, nothing is.
On the other hand, there's definitely a sense of justice about Faustus's demise. After all, he had it coming. He knew what he was getting into by signing his soul to the Devil and yet went right ahead and did it anyway. There was never any trickery involved in the bargain that he made; it was always understood that once his twenty-four years of power, wealth, and fame came to an end, Faustus's soul would be on its way South to the fiery pit of Hell.
Though contemporary standards of justice may be offended by Faustus's fate, there's no doubt that his demise is perfectly in keeping with how Marlowe's audience would've understood the nature of divine justice.