A sharp decline in coronavirus cases, shift in buyers’ preferences to large & spacious homes, evolving lifestyle, and increased supply and price-corrections resorted to by developers have given a big boost to the growth of the luxury real estate segment in India, particularly in recent months.
Apart from HNIs, which have always been associated with luxury buying, young executives, start-up owners, NRIs and millennials have also contributed largely to the purchase of luxury properties in the country. Though end-users largely comprise the buyer category, investors too have been showing keen interest in luxury realty, primarily because of the long-term yield it offers.
Responding to the trend, developers across the country have also increased the supply of luxury housing. Besides going for price corrections, they have focused on delivering quality luxury housing which is in consonance with the taste and requirement of the present-day buyer. They are conscious of the expectations of today’s buyers, which are vastly different from the traditional definition of luxury.
Besides world-class amenities and smart safety systems, today’s luxury homes are replete with all those features that contribute to a wholesome lifestyle, a prerequisite of the young, evolved buyer. The need for more open and green spaces, which every environmentally-conscious buyer now looks for, is well taken care of. More importantly, the properties on offer ensure the provision of multi-functional spaces, the need for which has become paramount due to the prevalent hybrid work culture of today.
All these factors combined have brought the luxury segment on the centre-stage of the real estate industry, with most research agencies reporting healthy uptake during the recent past and painting a brighter future in the days to come.
As per ANAROCK Research, for instance, luxury housing in India has performed remarkably well post the pandemic, with overall sales rising steeply across the top 7 cities. Of about 1.84 lakh residential units sold in these cities in H1 2022, close to 14% (approx. 25,700 units) were in the luxury segment. Contrastingly, of 2.61 lakh units sold in the whole of 2019, just 7% (close to 17,740 units) were in the luxury category.
“The Mumbai Metropolitan Region (MMR) and the National Capital Region (NCR) have led the sales of luxury homes, with the first half of 2022 seeing close to 17,830 units sold in these two cities alone. These two cities accounted for a mere 11,890 luxury homes sold in the entire year of 2019. In terms of overall sales share, MMR’s luxury housing sales share increased from 13% in 2019 to 25% in H1 2022. In NCR, the sales share rose to 12% in H1 2022, from 4% in 2019,” said Anuj Puri, Chairman, ANAROCK Group.
Commenting on the same, Manoj Gaur, President, CREDAI NCR & CMD, Gaurs Group, said, “Post-pandemic, there has been a huge change in people’s outlook towards life, showcasing an incline towards luxury living and an improved lifestyle. This includes not only the bigger size of projects but also the specifications and amenities that come along. Hence, luxury projects turn out to be the preference of buyers as they are a symbol of residents’ reputation and lifestyle. End-users have also played a big role with their new-found appetite for larger living spaces and willingness to spend. As things get back on the rails and pandemic fears recede further, more and more buyers are going to opt for luxury housing.”
Sanjay Sharma, Director, SKA Group, observed, “One can say with certainty that all segments of the real estate industry have attained pre-pandemic level with some having even surpassed it. Luxury housing is one such segment. While the luxury market is dominated by end-users, it has also become a hot favourite of investors.”
Lauding the multiple steps taken by the Government to regulate the realty sector, Sharma said, “A reformed and responsible industry with serious players is the toast of the investors now.”
Developers say the entry of new buyers in the market with more informed and evolved choices has also given a big push to the high-end residential segment.
Amit Jain, Director, Mahagun Group, said, “It is also significant that developers have been able to not only understand, but also respond to the transformed scenario by providing the right kind of assets.”
According to him, Delhi-NCR and MMR markets have been the biggest gainers in this regard, though the phenomenon is not confined to these two regions. “All parameters suggest that the luxury housing segment will become the crown jewel of the real estate industry pan-India in the not-too-distant future,” he added.