Luxury real estate gains while rupee falls
Owing to falling rupee that spurred NRI interest in buying properties in India and softening sales which decreased the real estate prices, the luxury real estate market in India has seen enormous growth. It is the right time for investors with big budgets, who have an appetite for some serious real estate investment.
From Apr 2013 to Aug 2013, around 25 percent hike has been recorded in the luxury market. Not only the NRIs, but the domestic buyers too have contributed to the rise in sales of high-end units. Long-term investors are likely to make more profit compared to slowdown.
Growing investments by HNIs and NRIs
The luxury residential projects target towards high-income group of buyers, who can afford the high-priced units. Though the real estate in India is running slow in the recent times, it offers a lucrative investment opportunity for NRIs and HNIs (high net worth individuals).
The number of high net worth individuals is growing in India and moreover, around 40 percent of their investment can be spotted in real estate sector. The fall in rupee has boosted up the buying interest in NRIs (non-resident Indians) and PIOs (person of Indian origin). While the rupee value is down, the NRIs buying properties in India is likely to save at least 20-30 percent capital value on the property and this is the reason they are showing increasing interest in buying properties now. All these factors have increased the demand for properties in luxury market.
Increasing queries for luxury projects
Nowadays, the developers have been receiving growing number of enquiries for luxury projects in Gurgaon and Noida. Other major cities and also the emerging cities like Chandigarh, Lucknow, Sonipat, Bhiwadi, Indore, Faridabad, have also been witnessing a similar trend.
Project location is important
The location of the project and the facilities being offered, play an important role in case of luxury properties. If a project offers all luxury amenities but is located far away from the city which has no good livability, then the buyers may not be interested to buy and the vice versa. Similarly, if a project has a good location but has not many luxury amenities or facilities, then too, the buyers may not consider the project. Hence, there should be a proper blend of all facilities and amenities, offered at a good location, only after which buyers will be happy to invest in.
The micro-markets in NCR such as Greater Noida, New Gurgaon, Yamuna expressway, Dwarka expressway, etc are expected to yield better results in the luxury segment.
Upper-middle class buyers too prefer luxury units
Besides the high-income group, due to changing lifestyle, buyers belonging to upper-middle class have also started showing interest in luxury residences with ultra-modern facilities. Since the population in this income group is quite bigger than high-income group, this trend is likely to boost up the transactions in luxury segment.
Theme-based projects
Moreover, growing exposure to foreign countries and changing lifestyles of the younger generations make them look for change in style, theme and innovative residences, which has increased the demand for theme-based projects such as German-style, Spanish-style, Disney-theme, European-theme, French-style, Goan-style, Mediterranean-theme, and many more. The developers keep track of the growing demand for such projects and come up with more innovative projects.
Promises good returns
The luxury segment seems to offer good returns for foreign as well as domestic investors. As per market experts, consumers in India tend to invest more especially when the rates are under pressure, which have contributed to the rise in sales of luxury units.
Real estate has always been a good investment destination for years, particularly in India. And the high-income population do not mind spending huge money for buying residences which offers them comfort, luxury and security. Adding to all these, the real estate market offers them good returns too, which makes it more attractive.
