Why are Buyers Flocking to Holiday Homes?

Noida, June 23, 2025: As cities grow denser and noisier, a rising number of homebuyers are seeking refuge in the hills. The demand for holiday homes in quieter, greener locations has seen a noticeable shift with buyers prioritising cleaner air, open spaces, and a stronger connection to nature.

Destinations like Dehradun, Rishikesh and Nainital are emerging as favourites, not just for their scenic beauty, but for the slower, more mindful lifestyle they offer. Real estate experts say the trend is being driven by a growing awareness around mental well-being and a desire to disconnect from the stress of urban living.

What was once considered a luxury is increasingly becoming a necessity for city-weary families looking for peace and permanence beyond the metro sprawl.

According to a recent report by MagicBricks, demand in Nainital alone rose by a striking 49.43 per cent YoY, positioning it as the most sought-after tourism destination for residential real estate investment in north India. Closely following this trend, Shimla recorded a 30.49 per cent YoY increase in buyer interest while Rishikesh saw a 30 per cent rise and Dehradun recorded a 25.55 per cent increase in customer searches. The surge in interest reflects a broader shift in buyer preferences as investors and second-home seekers increasingly favour serene, high-altitude alternatives to crowded urban markets.

Besides, better connectivity is playing a key role in turning once-remote holiday spots into viable second home destinations. Infrastructure upgrades like the upcoming Delhi-Dehradun Expressway and the Char Dham road projects are cutting down travel times significantly, making weekend getaways more practical and holiday homes more appealing.

Improved road networks and expanded air routes are reshaping the perception of hill towns—what were once seen as isolated retreats are now well-linked lifestyle hubs. As travel becomes easier, demand for homes in destinations like Rishikesh, Dehradun and beyond continues to rise driven by both convenience and long-term potential.

“The demand for holiday homes in tier 2 cities has seen a remarkable uptick. While metros remain key markets, emerging cities like Dehradun are gaining traction for their liveability and growth potential. Homebuyers here are not just investing in property; they are securing a lifestyle enriched by serene landscapes, clean air and a growing economic ecosystem,” says Manit Sethi, Director, Excentia Infra.

“Hence, with increasing property appreciation and a booming residential market, we believe these cities will offer the perfect balance between financial prudence and emotional fulfilment.”

Moreover, holiday homes in popular tourist destinations are seeing strong interest not just from end-users but also from investors looking to tap into short-term rental markets. With steady footfall driven by pilgrimage circuits, adventure tourism and seasonal travel, locations like Rishikesh, Shimla, Mussoorie and Bhimtal are experiencing near year-round occupancy.

Platforms like Airbnb and other homestay models have made it easier for homeowners to generate consistent rental income, especially during peak travel months. As demand climbs and inventory tightens, property values in these hill towns are steadily appreciating, making holiday homes a compelling asset class for those looking to diversify their real estate portfolio.

“Locations like Rishikesh, Ayodhya, Dehradun and Haridwar are witnessing a new wave of investors who are drawn to its unique mix of spiritual charm and strong rental prospects. Improved infrastructure, especially better roads and connectivity, has transformed the perception of holiday homes. They are no longer just seasonal retreats; they’re evolving into year-round assets,” Sunny Katyal, Co-founder, Investors Clinic.

“Buyers from metro cities are increasingly viewing these homes as dual-purpose investments, offering both personal use and attractive short-term rental income. Thus, with the consistent tourist inflow, we believe these cities will continue offering steady demand, making them a sound long-term investment opportunity.”

Therefore, the rise in demand for holiday homes is no longer just a passing trend; it reflects a deeper shift in how urban Indians perceive lifestyle, wellness, and investment.

As tier-2 and 3 cities become more accessible and as buyers increasingly prioritise peace, nature and better quality of life, destinations like Dehradun, Rishikesh and Shimla are emerging as preferred choices. These homes are now serving multiple purposes, offering a personal escape, a source of steady rental income and a hedge against the volatility of city real estate markets.