While Mumbai and Bengaluru often grab headlines for their sky-high real estate prices and perceived unaffordability, recent data suggests that other cities are providing better returns on property investments. While these metro cities remain attractive to Non-Resident Indians (NRIs), a shift is occurring in India's property market, with emerging hubs taking center stage.

According to a recent analysis, Hyderabad has emerged as the top metro for capital appreciation, leaving traditional real estate giants like Mumbai and Bengaluru behind. Investment banker Sarthak Ahuja's LinkedIn breakdown revealed that Hyderabad saw an impressive 80% price surge over the past four years. This contrasts sharply with Mumbai's more modest 40% rise and Bengaluru's 45% gain.

Noida and Gurugram are also outperforming Mumbai and Bengaluru with property price increases of 70% and 60% respectively. These figures highlight a significant shift in property market dynamics across major Indian cities, reflecting changing investor preferences and economic conditions.

Several factors contribute to Hyderabad's rise as a real estate investment hotspot. These include strategic demand bets, aggressive infrastructure development, and a bullish investor sentiment. Knight Frank's 2024 report supports Hyderabad's strong performance, citing consistent growth. While an exact 80% gain citywide isn't confirmed, the city ranks among the most consistent climbers in India's property market.

Bengaluru has a strong housing market and offers returns through capital appreciation and strong rental yields. Real estate in Bengaluru is a leading option for investment due to its economy, culture, and improved infrastructure. Property rates in Bengaluru have increased, especially in areas like Whitefield and Electronic City, due to the growth of tech parks and an influx of skilled workers. Apartment prices in Bengaluru have shot up compared to the previous year, topping the price rise report. Bengaluru also leads the way when it comes to rental yields, outpacing other major cities like Mumbai and Delhi.

Mumbai and Bengaluru remain important destinations for NRI investments, attracting NRIs seeking lucrative real estate prospects. NRIs are showing increasing interest in the Indian real estate market. Their contribution is estimated to escalate to 17% by 2025. NRI interest encompasses a broad spectrum, ranging from residential to commercial properties, and extends to emerging asset classes like data centers.

While Mumbai and Bengaluru continue to be important players in the Indian real estate market, potential investors should consider looking at cities like Hyderabad, Noida, and Gurugram, which are currently providing better returns.