Even as the overall real estate market is witnessing a robust demand in India, the second home market is also gaining pace with people considering buying another vacation home. According to a report by realty firm Axon Developers, Shimla, Sindhudurg and Coorg are among the top 10 destinations in India for second homes. It said the second home market size is set to cross $4 billion by 2026.
Other second home destinations, according to the report, are Dehradun & Mussoorie, Siliguri & Darjeeling, Nandi Hills, Pondicherry, Chamba & Tehri Belt, Rishikesh & Haridwar belt, Lonavla & Mahabaleshwar. The report identifies the most prominent vacation home/second home markets in India.
Ankit Kansal, managing director of Axon Developers, said, “There is limited information and insights available on the second home market. With this latest report, we try to highlight how the segment is transforming, what are the prominent markets, and what the future holds.”
According to the report, India’s second home market is no longer a niche segment as the demand for gated villas, cottages, and farmhouses amid idyllic environs and scenic natural landscapes is on an upswing. The uptrend in workcations, staycations, destination parties, and wellness holidays is further accelerating demand in the segment.
The market size of the second home or vacation market is set to cross $4 billion by 2026. “If we also add, farmhouses, rental villas, serviced apartments, etc. then the overall size is much larger,” it said.
In the northern India, Shimla (alongside Kasauli), Mussoorie & Dehradun, Tehri, etc. are popular second-home destinations. Owning a house amid spectacular Himalayan and Shivalik ranges and near the pristine pine forests is like a dream for many, especially in northern India. There is plenty to do here, from a simple walk or cycling in the woods to shopping in the traditional Bazaars to go after popular adventure sports such as paragliding, rafting, skiing, and an endless number of activities that can serve as an adrenaline rush for adventure junkies.
In the foothills of the Himalayas, besides the Ganges, Rishikesh alongside Narendra Nagar and Haridwar is also a desirable destination for many. The region is just four hours from Delhi and already is host to a plethora of world-renowned ashrams, yoga centers, Ayurveda resorts, etc.
In the West, after the opening of the Mopa airport in Pernem, the Sindhudurg and the adjacent regions stretching across the Goa-Maharashtra border are emerging as the hidden gem of Konkan. Undiluted natural bounties in the form of thick green forests, breathtaking hillocks, natural springs, and turquoise sea water make Sindhudurg the perfect destination to develop second-home villas, farmhouses, eco-hotels, etc. The region is also blessed with laid-back, but scenic, rural backyards and authentic Malvani-Goan cuisines that further make it a perfect destination to relax and rejuvenate.
There is a gold rush to own property in this region, which has also been expedited in the wake of the Rs 2,300-crore airport project. Property prices have jumped by 24-32 per cent in the past 12 months, making Sindhudurg one of the fastest-growing real estate markets in India. As the demand is soaring, rental yields are also attractive in the range of 6.7-7.2 per cent.
In the West, Lonavala, also called the Jewel of Sahyadri is another hot property market to look out for. Strategically located between Mumbai and Pune, it is a perfect weekend destination and rejuvenation hub with archaeological marvels, popular vantage points, acclaimed trekking trails, etc.
Quaint villages and valleys covered with thick greeneries are further icings on the cake. Currently, the average price at Lonavala is 8579/sq. ft. and has moved up by a CAGR of 7.3 per cent over the past four years. The rental yields are to the tune of 5.5- 6 per cent.
Just like Lonavala, in the Silicon Valley of India, the Nandi Hills region soaked with verdant scenery is an upcoming second home destination for Bangaloreans. Property prices are in the range of Rs 6,000-8,000 per sqft, growing at a CAGR of 4.7 per cent in the last four years.
“While property price growth has been moderate, the rental yield in the Nandi Hills is 6.6 per cent. High yields are also due to limited hospitality development against a tourist volume that is steadily rising,” Axom Developers said.
In Pondicherry, spread across coastal Tamil Nadu and located at a distance of 160 km from Chennai lies another popular second home destination. This beautiful city known for its unique blend of spirituality, French heritage, and Tamil culture, has seen a price jump of 7.5 per cent in the last year.
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