Demand for Luxury Homes Surges in India's Metropolitan Cities
The Indian real estate market is witnessing a surge in demand for luxury and ultra-luxury homes. This trend is attributed to several factors, including attractive festive offers, increased investment from non-resident Indians (NRIs), evolving lifestyles, and the emergence of a more affluent class.
Drivers of the Luxury Housing Boom
Several intertwined factors are contributing to this escalating demand:
- Festive Offers and Incentives: Developers are leveraging festive periods to offer attractive deals and free gifts, incentivizing buyers to invest in high-end properties.
- NRI Investment: The falling rupee has made Indian real estate more appealing to NRIs, boosting investment in the luxury segment.
- Changing Lifestyles: Evolving lifestyles and rising income levels are driving the desire for more luxurious living spaces.
- Global Lifestyle Trends: The influx of global lifestyle trends is influencing homebuyers' preferences, with features and amenities comparable to international standards becoming increasingly sought after.
Price Points and Demand
Demand for luxury homes priced at ₹20 crore or more is escalating in metropolitan cities across India. Homes in the ₹1 crore price range are also witnessing strong demand. While the overall real estate sector has experienced some recent sluggishness, developers are actively launching new luxury projects in major cities like Delhi, Mumbai, Pune, Chennai, Bangalore, and several Tier II cities.
Expert Insights
According to Ashutosh Limaye, research head at Jones Lang LaSalle (JLL), this trend is primarily driven by the growing number of high-net-worth individuals (HNWIs) and rapid urbanization. He also cites increased NRI investment as another key driver. "This trend is mainly due to the increasing number of well-heeled class of people. The increased number of NRIs as well as rapid pace of urbanization [are] other reasons behind this trend," Limaye stated. The increasing aspiration for international living standards is evident in projects like Lodha Group's World One Tower in Central Mumbai, where each unit is priced above ₹50 crore. "The real estate developers are stimulated to develop luxury projects above Rs. 1–Crore and below Rs. 20-Crores," Limaye added.
Market Statistics and Trends
Between 2008 and 2012, nearly $30 billion worth of luxury residential projects were launched, delivering 182 projects comprising 25,570 units across India's top seven cities, including Delhi-NCR, Mumbai, Bangalore, Chennai, and Kolkata. The growing number of HNWIs, currently estimated at approximately 1.53 lakh and rapidly increasing, is expected to further fuel demand for luxury homes.
Developer Response
Prominent real estate developers such as Lodha, Kohinoor Developers, Sobha, DLF, Wave, Sunteck, Supertech, and Hiranandani are actively involved in launching new luxury projects. JC Sharma, managing director of Sobha Developers, emphasized the broad-based demand in the market. "The market has demand for all sorts of homes. Affordable homes are demanded by the weaker section of the people. In the same way the affluent class raises demand for luxury homes," he stated. He further highlighted changing lifestyles and rising income levels as significant drivers. The demand for global standards and amenities among returning NRIs contributes further to the luxury home segment's growth.
Innovative Marketing Strategies
Real estate builders continually introduce innovative products to attract homebuyers. Developers are incorporating Singaporean and American-style apartment designs. Some firms have partnered with international celebrities like Maria Sharapova and Michael Schumacher for endorsements, while others have engaged Indian cricketers and Bollywood stars. Sunteck's Sunteck City, a Disney-inspired housing project developed in collaboration with Disney Consumer Products, exemplifies this trend. Lodha Group's partnership with Giorgio Armani for the design of Lodha World One, touted as the world's tallest residential tower, is another notable example.