Glossy entrance lobby with waiting lounge for guests. Outdoor areas with large patios. Bar zones and fire pits. Rooftop gardens, private pools and water walls. Top-of-the-line gym, high-speed elevators, clubhouse with tennis and billiards. Tick for all, because luxe is in.
Demand for premium homes has shot through the roof during the first eight months of this year, with luxury properties registering a staggering 130% growth and developers scrambling to cater to this significant surge, according to industry experts. They feel the combination of a buoyant economy, political stability, increased interest from HNIs and NRIs and a tilt towards aspirational investments is fueling this growth.
A look at the factors driving growth in luxury segment
# Buoyant economy: India’s robust economic growth and the emergence of diverse business models, have led to a burgeoning affluent population and large-scale urbanization, triggering more investments and subsequently, a soaring demand for premium homes.
# Lifestyle investment: With the increase in buying power, the aspiration levels have also gone up and investing in a better lifestyle has become more important. A prime want is a large home with premium features, sometimes even a second home. Post-Covid, the demand for larger living spaces has organically soared because people are spending more time at home with the WFH or hybrid work models.
# Traction from HNIs and UHNIs: For high-net-worth individuals (HNIs) and ultra-high-net-worth individuals (UHNIs), the real estate market is always a trusted safeguard against the vagaries of inflation. Post-pandemic, more than ever before, they are keen to park their money in luxury real estate.
# Demand from NRIs: The strengthening of the US dollar against the Indian rupee has stoked the interest of NRIs and there is an increased demand for high-end units from that segment. Also, with the rise in raw material prices like cement and steel, property prices are set to move northwards only. So, this is a great time to invest, concur market watchers.
# Cap on capital gains: Another factor going in favour of this trend of going for luxury homes is the government move to cap capital gains at Rs 10 crore in the Union Budget.
According to market sources, premium properties priced at Rs 1.5 crore and above accounted for nearly 20% of all residential units transacted in the leading cities of India over the past 18 months, as opposed to only 6.8% luxury homes sold during 2019. The continued traction in the premium segment after the pandemic has enabled developers to clear large portions of their inventories.
This positive sentiment in favour of luxury homes with a plethora of built-in amenities is expected to become more pronounced in the near-to-medium term, with the demand surge breaking new barriers. This is elixir for real estate developers after the slump during the pandemic period and the leading players are all ready to roll out high-end residential projects packed with the latest lavish features as they ride the premium crest.
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