Emerging serviced residence trend beyond Tier-I cities to tourist destinations

India’s real estate sector is undergoing a paradigm shift as serviced residences evolve from a niche concept into a mainstream investment class. Traditionally concentrated in Tier-I cities such as Mumbai, Delhi-NCR, Bengaluru; the segment has witnessed rising investor attention due to global demand for flexible living solutions. These serviced residences have tie-ups with leading hotel brands combine the familiarity of a home with the 4–5-star amenities of a hotel, making them attractive for both business and leisure travellers. Colliers’ latest report, “Transforming Goa: Unlocking Investment Potential Beyond the Coast” uncovers new real estate investments trends.

Tourist destinations driving the next wave investments

Beyond Tier-I cities, a new wave of serviced residence growth is taking shape in tourism centric destinations. Locations such as Goa, Rishikesh, Kasauli are witnessing heightened demand, fuelled by:

• Rising preference for long-stay and experiential stays.
• The growth of remote and flexible work culture.
• Shifting traveller mind-set from regular hotels to branded, professionally managed residences.
• Increasing appeal among second-home buyers seeking rental visibility and ROI alongside lifestyle benefits.
• In Tier-I cities, branded serviced residences associated with national or international hotel brands command an average sale price of around Rs 22,000 per sqft in Delhi, Rs 19,500 per sqft in Bengaluru and Rs 25,000 per sqft in Mumbai. In comparison, tourist destinations offer more attractive entry points, with Goa starting at Rs 11,500 per sqft followed by Kasauli and Rishikesh at Rs 9,500 and Rs 8,500 per sqft respectively.

Growth outlook

Goa stands out as, India’s premier leisure and lifestyle destination, with its unique blend of affordability, premium hospitality tie-ups, planned infrastructure projects and strong tourism-driven demand, Goa has gradually undergone a paradigm shift from villa to apartment typology with serviced residences emerging as one of the next major investment trends in India.

As global travellers and domestic buyers increasingly seek lifestyle-driven real estate options, serviced residences in Goa will be ideal combination of price appreciation, consistent rental yields and long-term lifestyle benefits cementing the state’s place as a preferred destination for investors and homeowners across India and globally. Over the years, Goa’s residential price appreciation of nearly 2.6X from Rs 4,000 to Rs 10,300 per sqft (2019-2025). Going forward, development is expected to expand from the coast to the hinterland, driven by the operationalisation of the Mopa International Airport, the planned Phase 3 and 4 expansions, proposed Aerocity and the DMIC corridor. This wave of growth is projected to fuel further price appreciation of 2.5–3.0X by 2032 with rental yield 8-12%.

Serviced residences are transforming into a high-performing asset class, combining investment growth with lifestyle appeal. With rising demand across emerging micro-markets, investors and homeowners have a unique opportunity to unlock long-term good return on investment, capital appreciation while also benefiting from attractive rental yields as second home or holiday home investment,” says Swapnil Anil, managing director, advisory services, Colliers India.