Real estate continues to remain an attractive investment option among high and ultra high networth individuals with 61 percent looking to invest in property in 2023-24.
As many as 34 percent home in on high rise apartments, while 30 percent on farmhouses and holiday homes. Around 65 percent budget for luxury properties worth between Rs 4 crore to Rs 10 crore and more than 33 percent aim for those beyond Rs 10 crore, according to India Sotheby’s International Realty’s annual survey.
Delhi NCR, Mumbai, Goa and Bengaluru remain the top four cities on the realty map for respondents. As many as 11 percent of India’s wealthy are searching for properties abroad. With the fear of the pandemic ebbing out and the world opening up, affluent Indians also look to acquire luxury apartments in New York, Miami, London, Dubai and Lisbon. Lifestyle upgrade remains the key motivation for buying property in 2023- 24.
As many as 75 percent of HNIs and ultra-high net-worth individuals (UHNIs) believe real estate will do well over the next two to three years and a similar percentage of 74 percent consider it is an important asset, reflected the annual Luxury Outlook Survey 2023 conducted by India Sotheby's International Realty (ISIR).
“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.
As many as 500 HNIs and UHNIs participated in the survey.
“Strong policies and reforms have supported India’s economic growth, making us the fifth-largest world economy in 2022. The ambition of becoming the third-largest in the world by 2037 also looks bright. There is also a 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 the fold of luxury real estate and that’s what we are witnessing,” said Amit Goyal, CEO, India Sotheby’s International Realty.
Lifestyle upgrade remains the key motivation for buying a property in 2023- 24, followed by capital appreciation. Around 12 percent 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.
“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,” Chadha said.
When asked if they would like to consolidate their real estate portfolio and upgrade to a property valued higher, as many as 45 percent of HNIs and UNHIs agreed.
“We believe that HNIs and UHNIs with multiple properties would benefit immensely from assessing their real estate portfolio, to remove under-performing 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.
“As many as 11 percent picked properties on account of sustainable features. Last year, this figure was at 5 percent. This indicates a growing awareness and availability of green, sustainable homes,” the survey found.
