Wed. Mar 29th, 2023

Around 65% budget for luxury properties worth between 4 crore and 10 crore, and more than 33% plan for homes beyond 10 crore
New Delhi: Real estate continues to remain an attractive investment option among high-net-worth individuals (HNIs) and ultra high-net-worth individuals (UHNIs) with 61% looking to invest in property in 2023-24, according to the annual Luxury Outlook Survey 2023 conducted by India Sotheby’s International Realty (ISIR).
As many as 34% homes comprise high rise apartments, while 30% farmhouses and holiday homes. Around 65% budget for luxury properties worth between 4 crore and 10 crore, and more than 33% plan for homes beyond 10 crore, it said.
According to the survey, an overwhelming 75% of the high and ultra high networth individuals believes that real estate will do well over the next two to three years, and a similar percentage (74%) consider real estate is an important asset to hedge against inflation.
“Strong policies and reforms have supported India’s economic growth, making us 5th largest world economy in 2022. The ambition of becoming the third largest world economy by 2037, also looks bright. And the optimism can be felt all around, including robust demand in the housing sector. As the wealth of a nation grows, it is bound to bring in a new set of buyers into luxury real estate and that’s what we are witnessing” said Amit Goyal, CEO, India Sotheby’s International Realty.
“We all are witness to a fundamental shift in the desire for home ownership across age groups, post the pandemic. A young thriving workforce in India will continue to drive demand for the housing sector,” added Goyal.
The survey also indicates that as many as 34% of HNIs and UHNIs have indeed bought luxury real estate since April 2021 and given that finding the right property and concluding a deal in real estate takes time, ISIR believes many of the HNIs and UNHIs are still on the lookout for well-priced luxury homes.
Lifestyle upgrade remains the key motivation for buying property in 2023- 24, followed by capital appreciation. Interestingly, 12% of the wealthy also picked real estate as a chosen asset class to create multi-generational wealth to pass on to the next of kin.
“There is no doubt that if done appropriately, real estate can be an excellent asset for wealth accumulation and an equally strong avenue to hedge against inflation and volatility of the stock market,” said Ashwin Chadha, president, India Sotheby’s International Realty.
“We also believe that Indian real estate has started its multi-year bull run in 2021, after years of remaining subdued. Prices of luxury homes have risen in the last 16 months, but they are still only marginally higher than the peak prices of 2015, making it possible for HNIs to strike well-priced deals even now,” added Chadha.
With the fears of pandemic receding and the world opening up, affluent Indians are also looking at acquiring luxury apartments in gateway cities of New York, Miami, London, Dubai and Lisbon.
45% of HNIs and UNHIs agreed to consolidate their real estate portfolio for a switch to higher quality property and income generation.
“We believe that HNIs and UHNIs with multiple properties would benefit immensely from assessing their real estate portfolio – to remove underperforming properties and switch to better quality real estate in the right locations with prospects of capital appreciation and rental income,” the survey said.
Larger homes and open green spaces combined with excellent physical and social infrastructure emerged as the top two reasons for wealthy Indians while choosing a property to buy.
“11% also picked sustainable features as one of the key reasons driving their purchase. Last year this figure was at 5%. This indicates a growing awareness and availability of green, sustainable homes,” the survey found which indicates the growing awareness amongst the affluent to live a more sustainable life and better availability of sustainable homes inventory as developers switch to green offerings.
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