Can Kashmir's Property Boom Last?

(MENAFN- Kashmir Observer)
File photo of Hotels in Gulmarg

Two decades ago, a one-kanal plot near the Boulevard in Srinagar sold for about ₹1 crore. Today, that same land could go for as much as ₹30 crore. In Gulmarg, a modest hotel once listed at ₹3 crore can now command ₹70 crore, or more.

It's not just inflation. These are wild leaps in property value, driven largely by Kashmir's rebirth as a tourist magnet.

“Every few months, I get calls from buyers in Delhi, Bombay, and even Dubai,” said Abdul Wahid, a property dealer based in Tangmarg.“They're not just asking for land. They want hotels, homestays, even old ruins, anything close to Gulmarg.”

Since 2005, tourism-related properties in Kashmir have multiplied in value anywhere from 15 to 35 times, depending on the location. That doesn't even count the money they bring in from business. Just the land and buildings themselves. A return of that scale has made people pause.

What's driving this boom?

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Tourism, first and foremost.

Despite the decades-long conflict and political tension, the past five years have seen record-breaking tourist numbers. Last year alone, Kashmir welcomed over 2 crore visitors, including a spike in high-end domestic travelers.

It's not just Srinagar anymore. Places like Sonamarg, Doodhpathri, and Yusmarg are seeing a rush of interest, and land along the roads leading to Gulmarg and Pahalgam, once considered too remote, is now snapped up by investors. Prices in some of these places have doubled or tripled just since the pandemic.

“Five years ago, people hesitated to buy beyond Tangmarg. Today, even Drang is considered prime,” said Wahid.

For those who got in early, the rewards are staggering.

Real estate analysts estimate a compound annual growth rate (CAGR) of 15% for tourism properties in Kashmir over the last two decades. In select pockets, it's touched 20%, not including rental income or seasonal earnings.

“For a small hotel owner, this means their asset is growing even when they sleep,” said Mir Sanaullah, an independent property consultant.“And unlike residential real estate, the earnings are much higher per square foot.”

But how long can this last?

That's the question hanging in the air.

Some believe Kashmir's property boom still has years to run, especially as better roads, flights, and internet access draw more tourists and investors. In March, the central government announced new infrastructure projects, including road expansions toward border towns and additional rail connectivity.

“This is not just a tourism story anymore. It's a connectivity story,” said Ajay Gupta, a hospitality investor from Gurgaon.“Once people feel it's safe and reachable, everything changes.”

Still, others are more cautious.

“In real estate, what goes up very fast tends to flatten, or fall,” said Irfan Majid, a banker turned real estate advisor in Srinagar.“We might not crash. But a slow-down is likely.”

Signs of saturation are already appearing. In places like Pahalgam, construction restrictions have tightened, and permits are harder to get. In Gulmarg, locals complain of water shortages and traffic chaos in peak seasons.

There's also the question of sustainability. Much of the current boom has come without clear planning. Roads are narrow. Sewage systems are under strain. Forest land is vanishing.

“There's gold in the hills, but we might ruin the hills digging it out,” said Rafiqa Jan, a schoolteacher in Yusmarg whose family turned part of their apple orchard into a homestay.“We built a bathroom for every room, but now the water table's gone down.”

What should investors do now?

Those entering the market today may not see the same 30x returns as early buyers. But a 10%-15% annual growth is still strong, especially in a region where land scarcity and tourist demand both remain high.

The smart money is now looking at second-tier destinations and green investments. Places like Lolab Valley and Bungus, once off the map, are gaining traction. Properties built with sustainable materials, solar heating, and water recycling are also starting to command higher rates.

“It's no longer just about location,” said Sanaullah.“It's also about what kind of tourist you want to attract. People who come for peace don't want to see a concrete jungle.”

And then there's policy.

If the government eases land-use laws, or offers clear titles for larger plots, it could unleash another wave of investment. But sudden shifts, like tighter environmental rules or political instability, could also spook buyers.

No one has a crystal ball.

But if the past 20 years tell us anything, it's that land in Kashmir, especially where the tourists go, has turned into one of India's hottest property bets.

The question is not just how much higher can prices go. It's how long before the market asks for something more than just location: planning, sustainability, and balance.

Because no boom lasts forever. And Kashmir deserves more than just another rush.

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