03 Jun A New Dynamic Of Luxury Residents And The Elite
The coronavirus pandemic hindered property investments, but the revival of the real estate markets has piqued the attention of the ultra-rich in the country. According to a recent survey, HNIs and mega-rich investors are particularly interested in investing in real estate, particularly in properties worth more than Rs. 5 crores.
Only Luxury Residents For The Ultra-Rich
A major aspect driving HNIs to choose homes with higher facilities is an upgrade in lifestyle due to the pandemic. Residents of luxury residences are closer to nature and have a retreat experience. The health benefits of living in large, natural spaces are important elements in luring purchasers to luxury residences. Homes are being used as workplaces, and people want large homes that can accommodate their needs.
In Quarter 1 of 2022, luxury real estate properties contributed 12% of total sales, rising from the 7% in Quarter 1 of 2019, because ultra-high-net-worth individuals rushed to buy larger properties to suit the need for additional space during the pandemic. As per a combined report by India Sotheby’s International Realty and CRE Matrix, luxury house sales in Mumbai and Pune were at their best in four years in 2021 and may hit a new peak in 2022. In 2021, 1,214 luxury residential properties worth a total of Rs. 20,255 crore were sold in Mumbai, up from 598 units worth Rs. 9,872 crore in 2018.
Homebuyers such as corporate families, startup founders and leading CEOs have been spending anywhere from Rs 50 crore to Rs 1,000 crore on properties like luxury 3 BHK flats in posh locations of Mumbai for their dream homes. A luxury residence includes spaces such as a home office, study rooms, gymnasium, recreational area, open spaces, and other amenities. With an increase in demand for high-end residences in certain regions of Mumbai, Delhi, Gurgaon, and Goa, the major destinations for luxury and uber-luxury properties in India, the luxury housing market in India is expected to make a comeback after almost half a decade.
Large families are selling jointly owned bungalows in desirable areas, according to property advisors, are driving up the supply of high-value properties in the metro cities. The properties are mostly owned by the elderly or many generations. “Most such real estate particularly that valued at Rs 25 crore have come onto the market following the pandemic. In several cases, the original owner is not alive and the next generation prefers to sell the jointly inherited property sooner rather than later.” said Amit Goyal, CEO of India Sotheby’s International Realty.
“Mumbai’s luxury housing market performed exceedingly well last year.” said Ashwin Chadha, President, India Sotheby’s International Realty.
“For the ultra-luxury buyer their home is about congregating with like-minded people in an amiable community, one that is replete with amenities and material comforts that their entire family can enjoy,” said Ramesh Ranganathan, CEO, K Raheja Corp Homes. “These clients hold key positions in the corporate world, are globally travelled and socially connected with people living abroad and seek nothing less than the best.”
India’s luxury real estate market is still modest in comparison to the United States, China, and Australia, but it is competitive with other major luxury markets such as New York, London, and Dubai. As Indians seek to live ‘large,’ the growing interest in luxury real estate signals a shift in urban Indian culture and how home space will be characterised. Real estate markets and tourism destinations will boom in the luxury housing category. While buyers would favour high-rise apartments in tier cities, they would focus on low-rise flats and villas in other cities, providing the luxury real estate sector with a significant overall boost.