Shifting Homebuyers' Preferences Boosting India's Luxury Real Estate Market

Authored by Anjana Sastri: India’s luxury residential real estate is poised to grow swiftly driven by increasing investments from the community in view of long-term benefits and a high quality of life.

This rise can be attributed primarily to the shifting trends in investment tastes and motivations of ultra-high-net-worth individuals (UHNWIs).

The desire for premium living spaces has increased as evidenced by the significant growth in sales of premium residences priced at Rs 1 crore and above, which accounted for 41 per cent of total sales in H1 2024.

This strategic increase in new developments reflects a steadfast belief in residential real estate as a cornerstone of wealth preservation and growth.

Improved lifestyle conditions The elite, who possess a desire for exclusivity and modern amenities, are looking for quality living spaces, and sustainable high-quality residential projects that have a multifunctional living environment.

The values of privacy and large spaces too are highly prized, reflecting their enthusiasm towards exceptional living conditions.

The country is increasingly seeing diverse options for comfortable living earlier experienced abroad.

With increasing realisation among the elite that conditions are improving in urban and suburban India despite a few bottlenecks, there is a significant rise in investment in luxury living.

High incomes and better infrastructure The growth in incomes and increasing urbanization with high income-generating assets have led to increased investment in upmarket residential properties.

This has been enabled by the rising economy, which is poised to be the third largest globally soon.

While these are the macro factors affecting investment decisions, there are other factors as well that work in this equation.

The enhanced rate of infrastructure development and improved connectivity in metropolitan areas make upscale properties increasingly attractive, as they lead to substantial capital appreciation.

Ease of property choice Digital tools have made it easier for buyers to search, choose and buy luxury properties.

Since some of the big-time investors are global citizens, digitalization has ensured the ease of many processes that would have been too time-consuming despite the physical presence of the buyer at a given location.

Virtual and augmented reality has made property purchase a near-physical experience that enables customers to explore a variety of property options and in fact virtually customise their choice.

Real estate’s enduring value A positive economic sentiment is visible in the country, reflecting in the resilience and potential of the Indian real estate sector.

Investors are strategically positioning themselves through residential real estate investment with the intent of creating and accumulating multi-generational wealth.

About 12% of India’s HNWIs plan to acquire a new home in 2024, a number that continues to reflect the robust appetite for residential real estate.

Driven by the attraction of upscale urban living and a growing population of high-net-worth individuals, affluent investors are crafting environments that epitomize comfort, exclusivity, and prestige.

High end real estate transcends mere acquisition and has become a profound statement of status and purpose.

In conclusion, it can be said that this trend presents exciting possibilities for the Indian real estate market.

With a growing number of the elite seeking prime residential investments, luxury developers can accommodate their desire for exclusivity, comfort, and long-term value.

The robust start-up ecosystem and a growing number of unicorns have added to the swelling ranks of the elite.

It’s crucial to stay ahead of the curve by anticipating transforming preferences and offering innovative solutions that cater to the elite’s ever-changing needs.

As we look ahead, the trajectory of India’s real estate market is positioned for further evolution, suggesting a promising outlook for the market in the years ahead.

(The author is director of marketing, Sterling Developers).