In a major positive sign, India’s luxury housing segment (units priced at Rs 4 crore and above) witnessed significant growth in sales between January and September 2024, showing a 37.8 per cent year-on-year (y-o-y) jump to 12,625 units, according to real estate consultancy firm CBRE South Asia. The segment had seen a total sale of 9,160 units in the year-ago period.
“Delhi-NCR, Mumbai and Hyderabad emerged as prominent markets, accounting for nearly 90 per cent of the total luxury housing sales across the top-seven cities. Further, Pune recorded a noteworthy increase in luxury sales activity, with 810 unit sales in the same period,” CBRE South Asia said in a statement.
In terms of quantum, luxury residential unit sales, Delhi-NCR topped with sales of about 5,855 units, a 72 per cent y-o-y increase, followed by Mumbai at nearly 3,820 units, recording 18 per cent y-o-y growth.
“A similar trend prevailed during the Jul-Sep’24 quarter in the luxury housing segment across the top cities, registering an 82% Y-o-Y increase in sales. The quarter witnessed total sales of ~4,360 luxury housing units compared to ~2,390 units during the same quarter last year. During the quarter, cities including Delhi-NCR and Mumbai predominated housing sales, collectively accounting for about 90% of total sales. Moreover, Kolkata saw a notable 1.6-fold increase in luxury residential sales,” CBRE stated.
According to the real estate consultant, the surge in demand for luxury housing has been primarily attributable to a growing preference among affluent buyers for enhanced amenities and more spacious living areas that complement their multifaceted lifestyles. Moreover, the increasing aspirational class has significantly contributed to the increased demand for luxury properties. Furthermore, the rise in NRI and astute domestic investors in the Indian real estate market has considerably fueled the heightened demand for luxury residences.
“This trend aligns with the shift in buyer preferences towards high-end units launched by leading developers, as evidenced by the substantial market share of tier-I developers. This shift is anticipated to persist, reflecting the evolving expectations of contemporary homebuyers who are now more discerning and informed regarding developer reputation, execution capability, and financial stability,” it added.
Overall Residential Sector during January-September 2024
The sector maintained a strong performance in absolute numbers, with over 225,000 units sold during this period. The steady demand has encouraged developers to introduce new projects and additional phases, adding about 2,15,000 units to the market. Mumbai, Pune, and Bengaluru collectively represented 64 per cent of total sales between January and September 2024.
“Boosted by strong market dominance, Mumbai, Pune, and Hyderabad collectively accounted for 64% of the cumulative unit launches from Jan-September 2024. The share of mid-range projects in total sales for the first nine months of 2024 was about 44%, followed by high-end and affordable projects,” it added.
Real Estate Sales Outlook
Anshuman Magazine, chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “India’s luxury housing market is witnessing significant growth, reflected in an increase in sales. Following strong performance in the first half of 2024 and the seasonal boost during festivals, we expect sales and new launches to exceed 300,000 units for the second consecutive year. However, elevated capital values in an uncertain global economy may lead buyers to adopt a cautious approach. Property prices will likely be influenced by unsold inventory, project quality, and infrastructure access.”
We also foresee heightened demand in the high-end and premium segments, with traditional mid-range markets like Noida, Bengaluru, Pune, and Chennai increasingly gravitating towards luxury developments. As the market shifts from bungalows to modern apartments and penthouses, the premiumisation of amenities will be a key differentiator in luxury projects, he added.
