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In the lap of luxury

Saturday, January 12, 2019

Higher income, increased purchasing power, favorable government policies coupled with higher aspiration levels for a better lifestyle have led to renewed interest and investments in luxury living.

Luxury housing in India is one of the fastest growing economies of the world; with a growing segment of consumers who aspire for the very best that money can buy. Furthermore, we see a growing segment of home buyers in a much lower age group who are millionaires today, vis-à-vis millionaires of yester years.

Gone are those days where people would be content to live in a modest home with bare minimum facilities and where only bungalows would be considered luxurious. Thanks to the improving economy and increasing purchasing power in the hands of people, Indians are now investing in luxury properties. With this increasing demand, more and more developers are coming up with several projects with world-class designs and amenities.

The definition of luxury may change over time, but the vital characteristics remain the same; location, neighborhood, amenities, technologies in construction and architecture, sustainable homes, green space, and security etc.; all these needs to be top-notch. Today, a buyer has a plethora of luxurious residence options to choose from amongst apartments, bungalows, duplexes, villas, high-rise condominiums and gated mansions.

In fact, real estate developers have gone that extra mile to pamper home buyers with luxurious products and services. In some of the super luxury properties, we find developers tying up with international hospitality chains that provide residents all facilities of a 5-star hotel like Room service, Laundry service, Concierge services, state-of-the-art facilities, best infrastructure etc.

Apart from the above, there is a growing trend of such properties being outsourced to property management companies. This helps in proper management in terms of security, gardening, car park etc., within the project. This helps in maintaining the property to the highest standards with the result being a better resale value when the residents decide to sell their property.

Architectural design and styling have become intrinsic and reflects the owner’s personality, a reflection of the luxury quotient of rich and the famous owning an ultra-luxurious abode. Homes today have graduated from being just comfortable living spaces into the luxury palaces styled by innovative furniture matching the architecture of the apartments. These homes are designed keeping in mind the art quotient to make it elegant, stylish, modern keeping in mind the aesthetic and luxury quotient. Indeed, architectural styles are today an important element for overall luxury quotient for an ultra-luxury home for ultra-rich.

In the recent past, the government has come out with some industry-friendly policies that have spurred growth of the sector. The implementation of RERA and other buyer-friendly policies has improved transparency resulting in greater trust factor among home buyers. Today, the lifestyle, habits, and mindset of people are quite different from what they used to be a decade ago, which is why the luxury real estate sector has really picked up now.

Today, people are willing to spend on quality and are ready to pay a premium, if it means having something world-class with the best lifestyle amenities, healthy living along with safety & security. Today, people don’t just want to live with the necessities, for the mantra is now ‘the more, the better.’ Owning a luxurious pad is a status symbol for the rich who flaunt the same among their peers.

In the current real estate scenario, a great number of Indians are opting for luxury homes, especially in the metro cities. Key luxury housing markets have witnessed steady appreciation in prices over the last few years. Studies and research conducted by top companies have shown that the top markets for such luxury home projects are Gurgaon, Mumbai, Bengaluru, Hyderabad, and Kolkata; for these cities are fast developing and are seeing an increasing number of buyers with the potential to invest in such projects, thanks to the business boom in these places.

In 2016, almost 45,000 luxury residential units were launched in the top nine cities of the country, constituting almost 21 percent of total housing launches. In this, Mumbai alone witnessed the launch of 17 percent projects with sales percentage at 16 percent. Experts who had predicted that luxury housing in India was finished failed to look at the fact that it caters to a specific segment of demand which has not gone away and never will. In various economic conditions and changes too, the country’s wealthy homebuyers will still want high-class homes gleaming with sophistication in great locations.

Unlike affordable housing, the market for luxury homes is not driven so much by home loans as by personal wealth. Also, investors active in this segment operate within a full-proof inner circle of well-heeled clients. Hence, the market for luxury homes continues to thrive within the specific segment of affluent buyers who continue to look for nothing but the best.

There is a misplaced perception that NRIs are the ones who buy most of these luxury properties. Industry reports state otherwise, almost 80 percent buyers of luxury homes are local end users and investors. Although, NRIs show a keen interest in buying such luxury properties in India, with the sentiment of having a home back in their country prompting such purchases and garnering the best ROI due to smooth policies. Having a base to return to is what prompts NRIs in investing in properties in India and since they want the best, they often opt for luxury housing.

The luxury housing segment has made giant strides in transforming and keeping pace with the rising expectations of the well-traveled, in terms of meeting their global standards of luxury and comfort. To add to this, with every passing year, more Indians are joining the ranks of the wealthy and are automatically on the market searching for luxury homes. Things have been looking up for some time now.

With the luxury market being global, marketers have restrategized their marketing strategies. Marketing of luxury real estate has undergone a sea change. Today, various new marketing tools are employed to reach out to a much larger target audience. Developers are taking to digital marketing in a big way as it gives them a bigger canvas to work on. With the help of social media, developers can target only that segment of home buyers that are relevant to them. This mode of marketing is more cost effective but at the same time reaches out to a wider audience.

With RERA in place, GST holding the promise of a unified taxation regime and various other policy measures by the Government bearing fruit, there is every reason to expect the Indian economy to move the next gear over the next few years, meaning that demand for luxury housing will grow even more in the immediate future.

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