Which is the best real estate investment right now? For many years real estate conversations in India centered around the familiar names. Delhi and Mumbai have always been seen as the safer and return friendly markets for property investment. Higher demand, better job markets and long histories of growth made both cities preferred choices. In recent years data shows that this scenario is slowly changing. Now real estate return is not limited to these two cities.
Recently a deep analysis of property prices across Indian cities shows that Bhubaneswar real estate returns were higher than many established markets. In the last decade Bhubaneshwar recorded higher price growth than Delhi and Mumbai and now investors are catching the interest of this city.
Understanding the price growth
In a ten year period, property prices in Bhubaneswar grew by more than 140 percent. In comparison, price growth in Delhi and Mumbai has been far from moderate. Both metro cities have seen stability with high starting prices having limited growth potential especially when compared to cities that are delivering the best real estate investment returns.
This is a common scenario in real estate markets. Cities that grow early and grow fast also get stagnation in price. Once that is achieved, returns are not that high. On the other hand, cities that start from a lower base rate can see higher growth once development and demand catch up.
Affordability played a big role
The biggest advantage with Bhubaneswar is its affordability. Ten years ago property prices were low enough for buyers to invest in this market. First time buyers, local professionals and small investors were actually able to afford homes here. This brought a lot of real demand as more people started purchasing, prices went up but not in a sudden way. The slow and steady rise is usually a good sign.
It gives the market time to adjust and investors who invested early are still seeing gains without the extreme ups and downs. Even now prices in this city are still lower than in Mumbai or Delhi. Due to this demand hasn’t slowed down and the market hasn’t seen long periods where nothing goes up.
Infrastructure made a difference
Infrastructure development is an important factor behind strong returns. In the last 10 years Bhubaneswar has witnessed improvements in roads, basic urban facilities, public transport and planned residential areas. Development programs backed by government and better city planning have improved overall livability.
People are willing to purchase homes when a city feels well planned and manageable, not overcrowded and chaotic.
Job growth and local demand
While Bhubaneswar may not compete with major IT hubs in terms of scale, Bhubaneswar has witnessed steady job growth in sectors like education, services, administration and small businesses. This has made a stable base of end users who want to live close to job.
This kind of demand is crucial. Markets driven only by investors can struggle during slowdowns. Real estate supported by real residents remains more stable, both for prices and rentals, while markets supported by only investors can struggle during slowdowns as more people choose to stay and work in the city in place of going to metro cities: housing demand naturally increases.
Rental income remained consistent
Real estate investment returns are not only about resale value because rental income is also important. In this city, returns have remained relatively balanced. Rents have grown alongside prices that is not always the case in metro cities
Due to high property prices in Delhi and Mumbai, investors face low rental returns. Even many times decent rents do not justify the buying cost. While in smaller cities the difference between price and rent is normally narrower: that helps overall returns.
What this means for investors
The bigger lesson here is not about picking one city over another, rather it is understanding where different cities stand in their growth cycle. Metro cities offer stability but their high prices limit future growth. While emerging cities offer more scope for growth mainly to long term investors.
Risks to keep in mind
Smaller cities have risks: liquidity can be slower while resale may take time and demand can vary by locality. There is no guarantee that every project or area will perform better. This is why due diligence is necessary.
Buyers should focus on well connected localities with visible development and proven developers.
A change across the market
This data shows a shift in India’s real estate market. Growth is spreading even in tier 2 cities. With infrastructure and economic activity becoming evenly distributed, areas offering the best real estate investment returns are emerging outside traditional big cities.
Delhi and Mumbai will remain important markets. But when it comes to long term returns, the strongest performance over the last 10 years has come from outside these traditional metro cities. For buyers willing to see beyond the obvious choices, the opportunity set is clearly wider than before.
Srishti Dhir is the Founder and CEO of Hub and Oak, a real estate and workspace solutions company with presence in India and the UK. She has a background in management from London Business School and has spent years working across the real estate industry. Srishti is an active real estate investor herself, with a focus on uncovering high potential assets particularly income generating properties and opportunities that aren’t immediately obvious to most. The way she looks at a deal goes beyond just the price. She factors in market data, the regulatory side of things, and whether execution is actually feasible, so she can figure out where the real upside is, not just what something costs on paper.
Through her work, she has developed a strong perspective on what drives real estate value in India, from infrastructure led growth and zoning changes to tenant demand patterns and capital flows. She is particularly interested in identifying asymmetric opportunities where downside risk is protected but upside potential remains significant. She also writes about real estate and what sets her writing apart is that it comes from someone who is actually in the market, doing deals. Real experience, broken down in a way that’s useful for investors, developers and occupiers alike.