In a significant trend shift, the affluent Indian demographic is increasingly prioritizing capital appreciation as the driving force behind luxury real estate investments, marking a notable resurgence of investor interest in the market. Recent high-profile acquisitions underscore this change, with Ambika Chauhan Aibara securing two sea-facing luxury apartments in South Mumbai for over ₹47 crore and the Halan family investing ₹104 crore in four twin apartments in the same project.
Fashion designer Vratika Gupta, founder of Maison SIA, further contributed to this wave by acquiring a penthouse in Mumbai’s ‘Three Sixty West’ skyscraper for a staggering ₹116.42 crore. This shift in motivation is propelled by heightened demand for luxury homes, a phenomenon attributed to limited launches in the luxury housing segment and the fear of missing out (FOMO) on coveted properties.
Real estate experts emphasize that the scarcity of housing supply in the luxury category plays a pivotal role in dictating the high prices. This scarcity has enticed multi-billionaires, including industrialists, Bollywood stars, and start-up founders. The trend is expected to persist as high net worth individuals seek to diversify into real estate following unprecedented gains in the equities market.
The annual Luxury Outlook Survey 2024 by India Sotheby’s International Realty brings forth compelling insights, revealing that 71% of wealthy Indians have plans to invest in real estate in the next 12-24 months. The survey indicates that capital appreciation has surpassed lifestyle upgrades as the primary motivation, highlighting a renewed confidence among investors in the real estate market.
Noteworthy is the finding that 83% of affluent Indians own multiple luxury properties, signaling a growing trend in viewing real estate as a compelling avenue for long-term wealth creation. Amit Goyal, Managing Director of India Sotheby’s International Realty, notes a shift in expectations among investors, driven by increasing economic momentum, record-breaking housing sales, and an all-time high stock market in 2023.
The survey further unveils that 44% of wealthy individuals consider capital appreciation as the key motivation for purchasing luxury properties over the next 24 months, indicative of a resurgence in investor confidence in the real estate market.
As demand for luxury properties continues to outstrip supply, these residences are evolving beyond mere status symbols. They embody a distinct lifestyle characterized by superior amenities, spacious living areas, and prestigious addresses.