India’s short-term rental market is set to see a growth spurt of over 50% in the next few years, fueled by the country’s booming tech sector, rising disposable incomes, and an ever-expanding appetite for authentic travel experiences. That’s good news for anyone eager to dive into property investments—especially if you know where to look.
In this article, we’ll identify five cities forecasted to be the most lucrative Airbnb hotspots come 2025, ensuring you can ride this wave with confidence.
| Position | Market Name | Avg. Occupancy Rate | Avg. Daily Rate | Revenue |
|---|---|---|---|---|
| 1 | Goa | 49% | ₹4,173 | ₹742,209 |
| 2 | Bengaluru | 49% | ₹2,003 | ₹368,308 |
| 3 | Mumbai | 61% | ₹4,339 | ₹938,924 |
| 4 | New Delhi | 49% | ₹3,338 | ₹574,538 |
| 5 | Gurgaon | 34% | ₹2,754 | ₹349,447 |
| 6 | Jaipur | 35% | ₹2,837 | ₹370,145 |
| 7 | Hyderabad | 44% | ₹2,921 | ₹459,697 |
| 8 | Kolkata | 46% | ₹2,336 | ₹393,430 |
| 9 | Chennai | 54% | ₹2,837 | ₹544,326 |
| 10 | Pune | 46% | ₹2,420 | ₹415,380 |
Source of Information: Airbtics
Current Market Dynamics
India’s vacation rental market has emerged as one of the fastest-growing segments globally, with the market projected to reach $2.39 billion in 2025 and expand to $3.22 billion by 2029 at an annual growth rate of 7.71%. This growth is underpinned by several structural factors that position India as a compelling investment destination for short-term rental properties.
The country welcomed 20 million international visitors in 2024, surpassing pre-pandemic levels by 2.3 million visitors, while domestic tourism reached an unprecedented 2.51 billion visits in 2023, representing a 44.98% increase from the previous year. Foreign exchange earnings from tourism totaled $28.077 billion in 2023, highlighting the sector’s significant economic contribution.
Best Localities to Invest in an AirBnB
Goa
Goa maintains its position as India’s second-most lucrative Airbnb market, generating ₹7.42 lakhs annual revenue with a 47-49% occupancy rate and ₹4,173 average daily rate. The state’s 10,601 active listings indicate a mature but competitive market.
| Prime Locations | Emerging Areas |
|---|---|
| Calangute & Baga | Siolim |
| Anjuna & Vagator | Assagao |
| Morjim & Ashwem | Mandrem |
| Arambol | |
| Palolem & Agonda |
Suggested Read: Why Should Your Buy a Property in Goa?
Bengaluru, Karnataka
Bengaluru represents a unique investment opportunity with ₹3.68 lakhs annual revenue and 49% occupancy rate, despite lower daily rates of ₹2,003. The city’s tech ecosystem creates consistent demand from IT professionals, startup entrepreneurs, and business travelers.
| Prime Locations | Emerging Areas |
|---|---|
| Indiranagar | Yelahanka |
| Koramangala | Electronic City |
| HSR Layout | Hennur & Kalyan Nagar |
| Whitefield | JP Nagar & Jayanagar |
| Central Business District (MG Rd, Brigade Rd) |
Suggested Read: Is it the Right Time to Invest in Bangalore’s Real Estate?
Mumbai, Maharashtra
Mumbai dominates the Indian Airbnb landscape with the highest revenue potential and occupancy rates. Properties in Mumbai generate an average annual revenue of ₹9.39 lakhs with a 59-61% occupancy rate and ₹4,339 average daily rate. The city’s combination of business travelers, international tourists, and limited housing supply creates optimal investment conditions.
| Prime Locations | Emerging Areas |
|---|---|
| Bandra West | Andheri West |
| Colaba & South Mumbai | Versova |
| Juhu | Malad & Goregaon |
| Powai | BKC (Bandra Kurla Complex) |
| Lower Parel & Worli | Navi Mumbai (Vashi, Nerul) |
Suggested Read: Top 5 Banks for Home Loans in Mumbai
New Delhi
As India’s capital, New Delhi offers consistent demand from government officials, business travelers, and cultural tourists, generating ₹5.75 lakhs annual revenue with 49% occupancy and ₹3,338 average daily rate. The market benefits from year-round business travel and peak tourist seasons from October to March.
| Prime Locations | Emerging Areas |
|---|---|
| South Delhi (Defence Colony, GK, Saket) | Mayur Vihar |
| Connaught Place & Lutyens’ Delhi | Dwarka |
| Hauz Khas & Green Park | Mahipalpur |
| Vasant Kunj | Lajpat Nagar |
| New Friends Colony | Paharganj |
Suggested Read: Circle Rates in Delhi 2025
Gurgaon, Uttar Pradesh
DLF Phases and Golf Course Road properties attract premium corporate travelers and expatriates seeking luxury amenities. Properties near Cyber City enjoy consistent weekday occupancy from business travelers. New Gurgaon and Dwarka Expressway offer lower entry costs with significant appreciation potential as infrastructure develops.
| Prime Locations | Emerging Areas |
|---|---|
| DLF Phase 1-5 | New Gurgaon (Sectors 81-95) |
| Golf Course Road | Golf Course Extension Road |
| Cyber City & Cyber Hub | Dwarka Expressway |
| Sohna Road | NH-8/Delhi-Jaipur Highway |
| MG Road | Sectors 50-58 |
Suggested Read: Luxury Properties in Gurgaon
Jaipur, Rajasthan
Despite lower absolute revenues of ₹3.70 lakhs annually, Jaipur offers the highest gross ROI at 2.5% due to significantly lower property acquisition costs. The Pink City benefits from robust heritage tourism, destination weddings, and cultural events.
The market maintains 35% occupancy with ₹2,837 daily rates, generating strong returns for investors focused on ROI optimization. Lower entry barriers make Jaipur accessible for first-time Airbnb investors seeking heritage market exposure.
| Prime Locations | Emerging Areas |
|---|---|
| C-Scheme | Vaishali Nagar |
| Civil Lines | Mansarovar |
| Malviya Nagar | Jagatpura |
| Bani Park | Jhotwara |
| Jawahar Nagar | Sitapura |
Suggested Read: Cost of Living in Jaipur
Hyderabad, Telengana
Hyderabad has emerged as a high-potential market with ₹4.60 lakhs annual revenue, 44% occupancy, and ₹2,921 daily rate. The city benefits from expanding IT infrastructure, pharmaceutical industry presence, and growing startup ecosystem.
| Prime Locations | Emerging Areas |
|---|---|
| Banjara Hills & Jubilee Hills | Financial District |
| HITEC City & Gachibowli | Nanakramguda |
| Madhapur | Kukatpally |
| Kondapur | Manikonda |
| Begumpet & Somajiguda | Secunderabad |
Suggested Read: Top 5 Banks for Home Loans in Hyderabad
Chennai, Tamil Nadu
Chennai provides consistent returns with ₹5.44 lakhs annual revenue and the highest occupancy rate among major cities at 54%. The market benefits from medical tourism, IT sector demand, and cultural attractions.
| Prime Locations | Emerging Areas |
|---|---|
| OMR (Old Mahabalipuram Road) | Porur |
| ECR (East Coast Road) | Sholinganallur |
| T. Nagar & Nungambakkam | Velachery |
| Adyar & Besant Nagar | Medavakkam |
| Mylapore | Perungudi |
Suggested Read: Home Loans in Chennai
Kolkata, West Bengal
Heritage properties near Park Street command premium rates while showcasing Kolkata’s unique colonial architecture. Salt Lake City and New Town ensure steady business traveler occupancy with proximity to IT hubs. Properties with distinctive Bengali design elements receive better reviews and command higher rates, particularly during cultural festivals.
| Prime Locations | Emerging Areas |
|---|---|
| Park Street & Camac Street | EM Bypass |
| Salt Lake City (Sector 1-5) | Behala |
| New Town & Rajarhat | Garia |
| Ballygunge & Alipore | Kasba |
| Southern Avenue | Howrah |
Suggested Read: Cost of Living in Kolkata
Pune, Maharashtra
Koregaon Park and Kalyani Nagar attract premium rates with their upscale amenities and vibrant social scenes. Properties near Hinjewadi and other IT parks enjoy consistent occupancy from corporate travelers. Proximity to educational institutions provides steady demand from visiting academics and students’ families throughout the academic year.
| Prime Locations | Emerging Areas |
|---|---|
| Koregaon Park | Hinjewadi |
| Kalyani Nagar | Wakad |
| Viman Nagar | Aundh |
| Baner & Balewadi | Magarpatta City |
| Kharadi | Kondhwa |
Suggested Read: Pune’s Real Estate Market Predictions in 2025
Top-Performing Airbnb Property Types in India
| Property Type | Top Locations | Why It Performs |
|---|---|---|
| Heritage Homes | Jaipur, Udaipur, Kolkata | Cultural appeal, 40–60% higher rates, high festival demand |
| Luxury Urban Apartments | Bandra, Koregaon Park, Indiranagar | High-end amenities, +35% workspace demand, business traveler appeal |
| Beachfront Properties | Goa, Kerala, ECR (Chennai) | 2–3x higher rates, 85–90% peak occupancy, solid off-season demand |
| Serviced Apts near Tech Hubs | Bengaluru, Hyderabad, Pune, Gurugram | Consistent weekday stays, low seasonality, steady corporate demand |
| Boutique Villas w/ Outdoor Spaces | Suburban/satellite towns near major metros | +80–100% weekend rate spike, popular for gatherings |
Suggested Read: How to Convert Your Home into an Airbnb?
Things to Consider Before Investing in an AirBnB
- Local Regulations: Check zoning laws, rental caps, and licensing requirements.
- Location Demand: Choose areas with year-round tourist or business traveler interest.
- Property Type: Select a property suited for short-term stays (studio, 1BHK, etc.).
- Initial Investment: Factor in purchase cost, furnishing, and setup expenses.
- Operational Costs: Account for cleaning, maintenance, utilities, and management fees.
- Competition: Analyze nearby listings for pricing, occupancy rates, and guest reviews.
- Occupancy Rates: Estimate potential income based on seasonal demand and trends.
- Guest Experience: Ensure amenities, security, and aesthetics are top-notch.
- Self-Management vs. Hosting Services: Decide whether to manage it yourself or hire a property manager.
- Exit Strategy: Plan for resale, conversion to long-term rental, or other uses.
Suggested Read: Home Loan vs. Business Loan for Airbnb
Conclusion
Investing in an Airbnb property is a smart move—but navigating financing doesn’t have to be complex. With Credit Dharma, you get expert guidance and end-to-end support to make the process smooth and stress-free.
From evaluating your loan options to disbursement, we ensure clear communication, personalized assistance, and no hidden surprises.
Frequently Asked Questions
Ownership documents, identity/address proof, utility bills, and possibly local permissions like a trade license or No Objection Certificate (NOC) from the housing society.
Yes, several companies like GuestHouser, Hostie, and local hospitality startups offer end-to-end Airbnb property management.
Airbnb income is considered rental income or business income under the Income Tax Act. GST may apply if earnings exceed the threshold (₹20 lakhs annually, subject to change).
Quirky stays, well-designed studios, villas with views, heritage homes, and centrally located apartments tend to perform well, especially in tourist-heavy or business-travel cities.
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