Evolving Dynamics of Luxury Housing in India

By : 360 Realtors

14 March, 2022

The pandemic has worked out well for the real estate sector in India, significantly boosting housing sales across different segments. The luxury segment, in particular, witnessed a sudden growth of sales across different demographics. This is a welcome change for the segment, which has undergone various fluctuations over the past ten years. The year 2019, in particular, wasn’t really a good one for luxury housing.

Back in 2010, it was primarily the NRIs, HNIs, and the ultra-rich that used to buy luxury homes. Even so, NRIs used to invest in homes primarily for commercial purposes. Hence, they mostly chose projects that would be reliable in terms of returns, i.e., affordable and mid-range homes. Moreover, whether a property would be deemed a luxury housing project depended largely on where it stood. Homebuyers seeking luxury homes used to pay an exorbitant amount of money simply to purchase a property at a certain location.

This situation has completely changed over the decade. Thanks to global exposure, consumers learnt what a luxury home should actually be like. Value proposition gained importance among luxury home buyers, with them seeking luxury and value for money at the same time. This led to an improvement of living spaces, security, amenities and other features in luxury homes.

Around 2013-14, developers expanded their focus and started targeting businessmen and CXO level professionals as buyers for luxury homes. However, the segment faced a number of roadblocks, and the inventory of unsold luxury projects kept growing in the largest property markets. This changed during the pandemic with lower interest rates, tax incentives, and easier home loans making luxury housing more affordable. The segment is likely to stay on a healthy growth trend in the near future.