JOIN USOver the last decade, India has evolved as a luxury home ground, with the luxury residential real estate market experiencing a growth in demand from end users as well as investors.
This is evident with the interest shown by big global names like Versace and Trump investing in and tying up with leading developers for ultra premium projects. Gradually, it is being seen that luxury housing is becoming the fastest growing segment amongst residential housing. Catering to a select class of home buyers, this segment could grow swiftly, supported by strong economic growth of the country.
Among the key metros and mini-metros in India, Bengaluru is emerging as one of the most sought-after cities, as the country’s top luxury home market. The last ten years have seen exponential growth due to the phenomenal boom the sector has experienced. The investments that were made by home owners saw great returns; moreover, the market here is far more realistic when it comes to luxury residential properties when compared with other regions like Mumbai and NCR. This encouraged more and more potential home buyers to invest. In fact, even among Non-Resident Indian (NRI) investors, Bengaluru rules the charts as the most favoured investment hotspot, closely followed by Ahmedabad, Pune, Chennai, Goa, New Delhi and Dehradun.
Bengaluru as a realty hub has seen a powerful transition from being a quiet retirement city to a progressive vibrant IT capital of the country, housing a host of entrepreneurs and nouveau riche individuals. Naturally, the average age of the citizens has dropped drastically to the 25-30 plus age group. This has positively affected the real estate market of Bengaluru, corresponding to the lifestyle preferences of its potential buyers.
One of the most prominent driving factors for this marked increase in real estate consumption is the rapid rate of job creation that has overshot all other Indian cities. Even though there was a dip in the national economic growth, Bengaluru consistently generated the highest number of jobs for engineers and management graduates among all cities of India. Thus, Bengaluru has grown both in terms of geography as well as economy.
Old world charm
Bengaluru is a glittering example of a city that has areas defined as ‘posh’ and ‘rich’ both in terms of culture and wealth. Areas such as Vittal Mallya Road, Richmond Road, Ulsoor Road, Sadashivnagar, Defence Colony, Malleswaram and Lalbagh enjoy the scenic beauty of independent houses ranging from quaint to illustrious.
Although there has been an increase in these being converted to apartment buildings, these areas have managed to retain their prestige.
Taking into consideration that the supply might not be adequate, these are considered extremely premium locations with no supply outcrop, which leads to the capital appreciation potential being
considerably high. While luxury apartment costs ranging between Rs 10,000 and Rs 25,000 per square foot may seem exorbitant, they are in fact very reasonable when compared with the rates going in premium locations of established cities like New Delhi and Mumbai.
The area space and luxurious lifestyle amenities that are offered against a backdrop of unblemished charm and grandeur is what is lacking in most other cities. A luxury apartment in Lalbagh overlooks lush green spaces, away from the otherwise concrete city. Malleswaram houses you in the lap of luxury surrounded by residential properties and green parks for children to enjoy their childhood. No other premium location of other major Indian cities offer such prices in the luxury segment.
The city has seen an increase in not just luxury apartments, but also an increase in luxury villas across the city. With rising congestion inside the city, families are moving to areas a little farther away. These super luxury plots in areas like Whitefield and Sarjapur can be found at prices
ranging from Rs five crore to Rs 10 crore.
These prices are still considered to be reasonable for luxury homes that offer excellent construction quality in highly coveted localities. This only goes on to reflect a long-standing market reality in Bengaluru, re-emphasising that it has always been driven largely by genuine end users. The residents of this city do not accept substandard products, and have always valued the high levels of quality that are not available in most other cities.
Return on investment
Investment advisory agencies have termed property as one of the highest return investment options. It has been noticed that a sizeable chunk of investments are coming in from the NRI community, with enormous disposable income. With systematic government policies and increasing awareness about properties and the ease of purchasing property in India, investments by NRIs in real estate have substantially increased. With Real Estate Regulatory Authority (RERA) implementing stringent rules on the housing sector, the processes have now become much more streamlined and systematic in nature, suiting the buying patterns of NRIs.
The biggest attraction of buying a luxury living space is fuelled by the amenities and value addition it provides. For premium builders, this provision remains sacrosanct to their offering. Right from high-end kitchens to multi-purpose clubhouses and robust surveillance
systems, they offer the best of the branded amenities.
Bengaluru as a city offers the buyer the right mix of posh apartments and villas basis the choice of location. This along with the difference in prices is a huge motivator for high networth individuals to recognise this city as a rewarding investment that in sync with luxury living.
(The author is chairman & MD – Mantri Developers)