The Indian luxury real estate sector has witnessed a remarkable resurgence, with high-end property sales soaring by an astonishing 130% in the initial half of 2023 compared to the corresponding period in the previous year. According to recent report by CBRE South Asia, a real estate consultancy, a total of 6,900 luxury residences, valued at Rs 4 crore and above, were successfully transacted between January and June this year. This showcases a significant increase from the 3,000 units sold in 2022.
The non-resident Indian (NRI) community has emerged as a pivotal force in propelling India’s luxury real estate sector to new heights. Increased NRI investments in the Indian real estate market have significantly boosted the demand for premium properties. The appeal of promising high returns and the stable outlook of the Indian real estate domain have been prime attractions for NRIs seeking upscale residences.
Aakash Ohri, joint managing director and chief business officer at DLF, shared his insights, stating, “There has been sustained sales growth across major Indian metropolises. NCR saw a sizeable jump in demand for homes with a flurry of new launches across product segments and categories. We have also observed a transformation in homebuyers’ preferences. One of the most significant trends this year has been an influx of demand for homes in the luxury and above segment. Today, luxury homes are no longer about the brick and mortar only, but the overall living experience with convenience and every amenity and facility, allowing people the time to pursue their passion.”
He also added that analysing consumer behaviour, Indian developers are now providing projects at par with global standards, not only for Indian buyers but also catering to a renewed interest from high-net-worth individuals (HNIs) and NRIs as well. Another reason for this pent-up demand is the long-term investment and business prospects in the uber-luxury realty market of India.
“The unmatched infrastructure, hassle-free service, and opulent experiences are gaining traction across corporate hubs like Gurugram, which is home to some of the most expensive commercial and residential real estate. This shift towards fostering communities as opposed to independent living has become crucial for long-term associations,” Ohri noted.
Among the key cities, Delhi-NCR, Mumbai, and Hyderabad emerged as the most prominent markets for luxury housing, contributing to nearly 90% of the total luxury home sales across the top seven Indian cities. Delhi-NCR led with 2,900 luxury homes sold in the first half of 2023, followed by Mumbai with 1,900 units and Hyderabad with 1,400 units.
Vivek Singhal, CEO of Smartworld Developers, commented that the luxury real estate market in India has witnessed a significant surge in 2023, as affluent buyers are increasingly seeking high-end properties that offer modern amenities and exquisite designs. This growing demand for luxury properties can be attributed to several factors.
He opined that firstly, there is a shift towards a more contemporary and sophisticated lifestyle among consumers, who are willing to invest in properties that provide a luxurious living experience. Secondly, the changing lifestyle preferences of affluent buyers are directly influencing their decision to opt for luxury properties.
“Additionally, the rapid urbanization in India has led to a greater influx of people into cities, driven by the search for better job opportunities, improved infrastructure, and higher standards of living. As a result, there is a rise in disposable income among individuals, particularly in urban areas where luxury properties are predominantly located. Even in Smartworld, we have seen an increase in demand for luxury homes. These consumers often prioritize experiences and quality of life, which can be reflected in their housing choices,” Singhal claimed.
In the second quarter of 2023, the luxury housing segment recorded an impressive 121% year-on-year increase in sales. Total sales for the quarter reached 3,100 luxury homes, compared to 1,400 units during the same period last year.
Kalpesh Mehta, founder of Tribeca Developers, has also seen remarkable growth and demand post pandemic. The increasing number of HNIs and their desire for exclusive properties have contributed to this. There has been a surge in the number of NRIs investing in Indian real estate. Additionally, the last few years has seen a significant shift in buying behaviour.
“The pandemic has prompted buyers to reevaluate their living spaces, with a growing preference for larger, more personalized residences. Consumers are looking for more homes that not only provide comfort and security but also cater to their evolving needs, such as dedicated workspaces, recreational amenities, green views and others,” Mehta said.
The surge in luxury home sales during the first half of 2023 reflects the changing preferences of the aspirational class and the confidence of NRIs in India’s real estate market. The escalating demand for enhanced amenities and spacious living areas, combined with increased NRI investments, paints a promising picture for the future of the luxury real estate sector in the country.
