In a social media-driven world, it’s hard to find a moment of peace and quiet, especially when you’re walking through the hustle and bustle of another city. So, if you are a discerning traveler and want to avoid crowded hotels and cookie-cutter stays, rental places are the perfect option. And this hospitality segment is growing rapidly, according to a research report by Axon Developers, the branded rental villas market is expected to reach US$1377 million by 2028, growing at a CAGR of 33.2% in the coming years.

But why now? Villas and homestays have been around for years, yet the last decade has seen a sharp increase in demand for luxury rental spaces. Whether it’s a beachside retreat in Bali, a tranquil countryside retreat in Tuscany, or an exotic mountain getaway in Himachal, travelers are increasingly attracted to locations that offer unparalleled privacy. Responding to this growing demand, Tejas Parulekar founded saffron remains In 2015. Inspired by childhood holidays in the heritage bungalows of Tata Guest House and family trips across Europe, which highlighted the allure of private BnBs, Parulekar saw a gap in the Indian market. There were very few luxurious, family-friendly private homes for the convenience of modern travelers.

In a conversation, Parulekar spoke about the driving forces behind India’s rental stay market and how SaffronStays is fulfilling the desire for personalized experiences.

Who are the biggest drivers of? luxury rental market In travelling?

Homestays have always been a part of India’s travel landscape, but the challenge was the absence of reliable, trustworthy and consistent operators in the sector. Travelers were often hesitant due to concerns about quality, cleanliness, and overall experience. The turning point came with Covid-19. Before the pandemic, our growth was gradual and organic, as a significant effort was put into educating customers about the concept. However, during the pandemic, travelers wary of crowded hotels began exploring villa rentals as a safer, more private option. What is noteworthy is that this change did not end even after the pandemic. Instead, it marked a permanent shift in priorities. Today, more families, groups of friends and even coworkers choose the comfort and exclusivity of homestays and villas rather than the sterile and predictable experience of hotels. This secular shift is fueling the rapid growth of India’s premium villa rental market.

There has also been significant growth on the supply side. After COVID-19, many landowners who previously owned undeveloped parcels felt compelled to build their villas as private retreats. This trend has led to a sharp increase in the prices of land and villas in popular holiday destinations like Goa, Alibaug, Karjat, Coonoor, Kasauli and Dehradun. These developments have unlocked prime real estate in some truly spectacular locations, further fueling the growth of the premium villa rental market.

The hospitality industry is growing at an annual rate of 15%, with 1,66,000 branded hotel keys and plans to add 55,000 more over the next five years – an annual growth of 4.5-5.5%. However, due to consumption-led economic growth, demand exceeds supply by an estimated 25-30%. This gap is being filled by homestays and bed-and-breakfast setups, which require significantly less investment and shorter development timelines than hotels.

Why are more travelers choosing offbeat homestays/villas today?

‘Privacy’ is the new luxury. The concept of luxury has moved away from traditional markers such as “white-glove” hospitality, lavish receptions or Italian marble bathrooms. Today, luxury is defined by the exclusivity of living in a private villa, with the freedom to enjoy the entire pool and expansive lawn. Be it tasting secret regional dishes, sleeping under the stars, plucking fresh vegetables from the farm for dinner, or waking up to a breathtaking sunrise over the mountains. These are authentic, immersive experiences that money can’t buy – true luxury in its most personal and meaningful form.

For groups of friends, families or coworkers, hotels often feel restrictive due to limited access to private spaces and the need to share common areas. Villas, on the other hand, offer privacy, flexibility, and the ability to relax at your own pace, making them an increasingly popular choice.

Today’s travelers, especially Millennials and Gen Z, value unique experiences. How is SaffronStays serving this new generation of experience-driven travelers?

Absolutely. Gen Z is no longer obsessed with traditional or old brands. Instead, they are willing to pay for ‘gram-worthy experiences. At SaffronStays, we fulfill this desire by offering homes with extraordinary and diverse views, from open mountain ranges and river banks to ocean views, mountain peaks, gardens and fields. These picturesque settings offer unique, intense experiences that appeal to millennials and Gen Z who are constantly looking for fresh and Instagram-worthy moments in their travels.

We have introduced many facilities and services to attract young travelers. For example, we offer pet-friendly stays to growing families traveling with pets. Some of our properties are equipped with large screens and projectors, perfect for enjoying events like the IPL season. We also offer a range of outdoor experiences, including al-fresco dining, barbecues, treks, swimming in lakes and rivers and even kayaking in private lakes. These unique activities and amenities help create memorable experiences for young travelers seeking adventure and relaxation in nature.

What are your plans for the next five years? Can you share any upcoming projects or expansions with us?

Currently, we manage over 300 homes with 1,250 rooms under the SaffronStays brand across India. This year, our focus has been on expansion in Goa and Rajasthan, while we will continue to strengthen our presence in established markets such as Maharashtra, Uttarakhand and Himachal Pradesh.

Over the next five years, we aim to manage over 5,000 rooms in around 1,250 villas and estates, aiming for an annual revenue of Rs 500 crore with a healthy EBITDA margin of 8-9%. To achieve this, we plan to raise USD 5-7 million to further invest in supply enhancement, technology and marketing.

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