Luxury house | Image:Unsplash
Wealthy embrace real estate: In the next 12-24 months, 71 per cent of affluent Indians plan to invest in luxury real estate, according to the annual Luxury Outlook Survey 2024 by ISIR. This marks a shift from the previous year, with capital appreciation now surpassing lifestyle upgrades as the primary motivator for real estate acquisitions.
Loan rates anticipation
The survey reveals that High-Net-Worth Individuals (HNIs) and Ultra High-Net-Worth Individuals (UHNIs) are notably confident about the real estate market, with an impressive 79 per cent expressing optimism about the economy’s positive trajectory, compared to 59 per cent in the previous year.
Concerning home loan interest rates, 56 per cent of HNIs and UHNIs anticipate a reduction in interest rates by the Reserve Bank of India (RBI) in 2024, indicating a positive outlook for mortgages and financing.
Wealthy’s property mix
The survey also sheds light on the diversified real estate portfolios of affluent Indians, with a striking 83 per cent owning multiple luxury properties. Besides primary residences, ownership extends to 34 per cent in commercial real estate, 25 per cent in holiday homes, 21 per cent in agricultural land, and 20 per cent in farmhouses.
Goa: Second-home paradise
Goa remains a preferred destination for holiday homes, with 35 per cent of respondents selecting it as their second-home location. Meanwhile, the desire to invest in overseas properties remains stable at 12 per cent, with Dubai UAE and the USA ranking as top choices.
Of the surveyed UHNI and HNI respondents, 43 per cent express a desire to consolidate their portfolios, focusing on high-quality properties and rent-yielding assets. Additionally, 34 per cent of UHNIs and HNIs have embraced digital mediums, including 3-D virtual reality and walkthroughs, for property research and viewing.
Startups fuel prosperity
Amit Goyal, Managing Director, ISIR, highlights the renewed interest amongst investors who view real estate as a compelling avenue for long-term wealth creation. The robust start-up ecosystem and growing number of unicorns in India contribute to the rise of the ultra-wealthy, with the affluent class expected to nearly double to 100 million people within three years, according to Goldman Sachs Group Inc.
Ashwin Chaddha, CEO, ISIR observes a significant shift in economic sentiment, reflecting the resilience and potential of the Indian economy. He emphasises the increased launches of new luxury projects in 2023 across the top seven cities and the acknowledgement of real estate’s enduring value and potential for sustained financial growth. Investors are strategically positioning themselves for wealth accumulation and creating multi-generational wealth through real estate investments, according to Chaddha.
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