Affluent Indians’ Penchant For Luxury Property

Despite an almost 40 percent rise in property prices over the last 24 months and increase in mortgage prices, an overwhelming number of wealthy and high-networth Indians have a penchant to invest in luxury property in 2024 and 2025.

According to the annual Luxury Outlook Survey 2024 conducted by India Sotheby’s International Realty (ISIR), riding high on the robust economic optimism, for 2023-24, 71 percent  High-Net-Worth Individuals (HNIs) and Ultra High-Net-Worth Individuals (UHNIs), have expressed their confidence in the market and shown their intent to buy real estate in the next 1-2 years ., compared to 59 percent last year.

Capital appreciation has overtaken lifestyle upgrades, as the primary motivation for real estate investment by 44 percent of respondents. Fifty-six percent of HNIs and UHNIs are looking to invest in real estate in view of positive mortgage and financing outlook. All this is signalling a return of investors to the market, with a focus on long-term appreciation.

” The affluent class is expected to nearly double to 100 million people within three years, according to Goldman Sachs Group Inc.  The robust start-up ecosystems and a growing number of unicorns have added to the swelling ranks of the super-rich. Our Luxury Outlook survey findings indicate a renewed and heightened interest among investors who now view real estate as a compelling avenue for long-term wealth creation. We believe the top end of the real estate market will benefit the most in the next 12-24 months”, says Amit Goyal, Managing Director, India Sotheby’s International Realty.

Adds Ashwin Chaddha, CEO, India Sotheby’s International Realty,” There’s been a substantial increase in the launches of new luxury projects across the top seven cities in 2023. There’s also a shift in sentiments that aligns with a broader acknowledgment of real estate’s enduring value and potential for sustained financial growth. We believe investors are strategically positioning themselves for wealth accumulation and creating multi-generational wealth through real estate investments”.

The survey also reflected that a staggering 83 percent of affluent Indians own multiple luxury properties, reflecting a trend of diversified real estate portfolios among the elite. Apart from primary residences, respondents showcased a diverse array of real estate assets, with 34 percent owning commercial real estate, 25 percent holiday homes, 21 percent agricultural land, and 20 percent farmhouses. In other notable findings, 35 percent of holiday home buyers expressed Goa as their preferred destination, highlighting the enduring appeal of Goa’s lifestyle among India’s wealthy. Desire to invest in overseas property remained stable at 12 percent, with Dubai UAE, and USA maintaining their positions as top choices. As many as 43 percent of UHNI and HNI respondents expressed a desire to consolidate their portfolios, focusing on better-quality properties and rent-yielding assets.