by 99Realty 
India’s tradition of luxurious living dates back to the eras of maharajas and nawabs, who epitomized opulence with their grand palaces and elaborate artifacts. This legacy has evolved significantly, transcending royal families and reaching a broader spectrum of society. Today, the aspiration for luxury living is more pervasive, reflecting the growing affluence and aspirations of India’s expanding middle and upper classes.
Booming Demand for Luxury Residences
The luxury residential market in India has witnessed a remarkable surge, driven by several key factors. High-rise apartments in metropolitan cities like Mumbai and Delhi, along with lavish villas, have seen a substantial increase in demand. According to CBRE, sales of luxury housing units priced at ₹4 crore and above rose by 27% in the first half of the year, with approximately 8,500 units sold across seven major cities.
Key Markets Leading the Trend
The Delhi-NCR, Mumbai, and Hyderabad markets have been at the forefront of this luxury housing boom, accounting for around 84% of luxury housing sales in top cities. Pune has also experienced significant growth, with luxury housing sales increasing nearly sixfold on an annual basis to about 1,100 units. Mumbai’s high-end residential market, particularly properties priced above ₹10 crore, saw sales totaling ₹12,300 crore in the first half of 2024.
Factors Driving Luxury Housing Demand
1. Rise of High-Net-Worth Individuals (HNWIs)
The increase in the number of high-net-worth individuals (HNWIs) in India is a major driver of luxury housing demand. These individuals seek exclusivity, privacy, and high-end amenities, making luxury homes a preferred choice. According to a report by JLL, millennials, who comprise 36% of the population, accounted for 54% of homebuyers last year, with a combined spending power exceeding US$330 billion.
2. Urbanization and Rising Income Levels
Rapid urbanization and rising income levels have transformed metropolitan landscapes, leading to a surge in demand for premium residential properties. As more people migrate to cities and experience higher standards of living, the preference for luxurious homes with prime locations, superior amenities, and modern comforts has intensified.
Resilience and Growth of the Residential Sector
India’s residential real estate sector has shown remarkable resilience and growth despite facing multiple challenges, including demonetization, the implementation of the Goods and Services Tax (GST), the NBFC crisis, and the COVID-19 pandemic. Policy interventions such as the Real Estate (Regulation and Development) Act (RERA) have made the sector more transparent and customer-centric, contributing to its sustained strong demand.
Market Performance and Future Projections
In 2023, India’s residential real estate sector achieved an 11-year high, with 1.73 lakh units sold in the first half of the year. Mumbai led this growth with a 27.3% increase, totaling 47,259 units, followed by the Delhi-NCR region with 17%. The United Nations World Urbanization Prospects report projects that Delhi will become the world’s most populous city by 2028, further driving demand for residential properties.
Developer Strategies and Market Response
Developers have capitalized on the rising demand for luxury housing by launching multiple high-end projects. For instance, DLF’s luxury project in Gurugram sold out completely even before its official launch, achieving new sales bookings worth ₹7,200 crore. Similarly, Signature Global’s premium apartments worth over ₹2,700 crore received an overwhelming response.
Rising Property Prices and Market Potential
The broader residential market has also experienced a surge in demand, leading to rising property prices. For example, property prices in Bengaluru have increased by 57% over the last five years, while the National Capital Region (NCR) and Mumbai Metropolitan Region (MMR) have seen a 49% rise. The Indian real estate market, valued at approximately ₹39 lakh crore, is projected to expand to ₹484 lakh crore by 2047, driven by rapid urbanization and increasing incomes.
India’s luxury residential market is poised for continued growth, supported by the rise of HNWIs, urbanization, and increasing income levels. As developers continue to launch premium projects and consumers seek high-end living experiences, the market’s future looks promising. By offering comprehensive insights and detailed analysis, we aim to provide an in-depth understanding of the dynamics driving India’s luxury residential market.
