Tech IPO boom to unleash a wave of luxury real estate buying

According to Azeez, housing sales data for H1 CY2025 already reflects this shift toward the upper end of the market. “While overall residential sales declined by around 13% year-on-year, the premium and luxury segments continued to show strong momentum—units priced between ₹1.5–3 crore rose 8%, Rs 3–5 crore up 14%, and those above Rs 5 crore grew 8%. In contrast, the mass-market segments witnessed steep declines, with Rs 50 lakh–1 crore homes down 40% and sub-Rs 50 lakh homes down 37%.”

As a result, the share of luxury home sales in overall housing transactions rose sharply from 51% in H1 2024 to 62% in H1 2025, underscoring a shift in demand driven by HNIs and liquidity-rich investors, including beneficiaries of recent IPOs and startup exits.

ESOP millionaires and the “First Home” aspiration

For many startup employees, a luxury home represents not just comfort but validation. In addition, the emotional connection to property remains strong, especially for those who’ve seen their paper wealth materialise after years of building startups.

“Luxury and high-end residential will definitely be direct beneficiaries,” said Sandeep Jethwani, Co-founder, Dezerv.

“First-gen millionaires want marquee addresses in Tier-1 cities. Most first-time wealth creators will focus on primary residence plus diversification into financial assets. For commercial real estate exposure, I expect they'll prefer REITs and InvITs rather than direct commercial property investments,” he added.

To be sure, new-age tech-based companies are not the only ones whose promoters have made significant real estate plays after listing. In 2024, around a year after the IPO of electricals and consumer electronics firm RR Kabel, its promoters, Shreegopal Kabra and his family, purchased flats worth Rs 198 crore at the marquee 360 West project in Worli, developed by Oberoi Realty, signalling how IPO wealth continues to flow into marquee addresses and trophy assets.

Industry veterans pointed out that this pattern is both rational and strategic.

“Unlike equities and debt instruments, real estate offers intrinsic, tangible value coupled with steady rental income and potential for long-term capital appreciation. In today’s volatile economic environment, physical assets serve as a crucial hedge against inflation and market uncertainty, providing portfolio stability that purely financial instruments often cannot guarantee,” said Niranjan Hiranandani, Chairman, Hiranandani Group and NAREDCO.

He added that promoters are increasingly recognising that upscale apartments in key urban centres, holiday homes, and land parcels not only preserve wealth but also reflect their commitment to creating lasting value beyond paper gains.

Different risk appetite, different behaviour

The new class of tech millionaires differs sharply from traditional corporate executives when it comes to how they handle newfound liquidity.

Anand Rathi’s Azeez pointed out, “Traditional executives, whose wealth accumulation is typically more gradual and salary-based, tend to focus on asset preservation or reinvest in their existing businesses for organic growth. In contrast, new-age tech founders view liquidity events as an opportunity to diversify their capital across multiple avenues, reinvesting in their own ventures, backing new startups, launching venture capital or angel investment funds, and building diversified financial portfolios.”

At the same time, he noted, many selectively channel part of their wealth toward tangible assets such as “primary or luxury homes, cars, and lifestyle upgrades, reflecting both aspiration and long-term wealth anchoring.”

Jethwani agreed that while tech professionals are natural risk-takers, they need to balance it with discipline.

“Tech founders and employees are inherently greater risk takers when compared with traditional professionals. However, they should understand that they are already taking disproportionate risk by starting and running a startup. They shouldn't compound risk across all areas by not thinking through asset allocation,” he said.

IPO wealth and real estate correlation

The link between IPO booms and real estate is increasingly becoming visible, especially in India’s tech hubs.

“Historically we have seen a correlation between buoyant IPO cycles and a surge in luxury or high-end housing demand,” Azeez said. “In India, the recent IPO wave post-pandemic after 2021 coincided with an uptick in premium housing sales, especially in metros like Bengaluru, Mumbai, Pune, and Gurugram, where many tech and startup employees are concentrated.”

He pointed out that during the record IPO year of 2021, “the share of homes priced above Rs 1.5 crore doubled from around 7% in 2019 to nearly 14% by 2022, even as the mass-market segment largely plateaued.” The same trend, he said, continues into FY25, with IPO-linked liquidity “keeping the premium housing segment resilient even in a moderating market.”

Jethwani, however, struck a note of caution.

“It's observable but I wouldn't characterise it as a strong correlation. The luxury housing market in India is massive, and ESOP spikes in tech-driven tier-1 cities represent a small percentage of overall luxury demand. To put this in perspective: HDFC Bank alone created Rs 5,282 crore in ESOP wealth in 2024, while all Series B+ startups combined generated around Rs 2,098 crore. Listed companies continue to dominate actual ESOP wealth creation.”

Road ahead

With a host of tech companies and other major firms eyeing their public market debut, the coming quarters may not only mint new millionaires but also reshape the real estate markets of India’s biggest cities, as IPO wealth finds its way into luxury homes and premium addresses.