The luxury real estate market in South India should keep witnessing its present momentum throughout the year 2021, particularly in the cities which are manufacturing and IT-ITeS backed economic hubs, namely Chennai, Bangalore and Hyderabad. The South Indian luxury realty market has been majorly unscathed on account of the COVID-19 restrictions and the pandemic actually drove higher demand for bigger and ready to move units. With businesses and Governments re-assessing their strategies, the market is seeing increasing interest from HNIs or high-net-worth individuals along with NRIs. These are investors seeking a stable asset class for investments along with plush and managed residential units.
The momentum in the luxury market will also be driven by growing demand for units with multi-purpose and more usable spaces within integrated townships, providing top-notch amenities, big open spaces, connectivity features and sheer exclusivity. NRIs have always viewed South India as an attractive realty market owing to proper pricing, higher rental income, timely completion of projects and several trusted real estate developers. Demand has gone up considerably for 3 and 4 BHK units along with villa projects. Buyers are not looking at sq. ft. figures of homes but more rooms for working, studying and so on.
Experts feel that this segment witnessed considerable growth for the fourth quarter of 2020. Top companies churned out high sales figures owing to consolidation in the market. Bookings from NRIs are anticipated to grow with demand for bigger units. Buyers in the segment are also getting drawn to several offers and discounts while a depreciating rupee means higher purchasing power for NRIs as well.
Alongside, HNIs have diversified their portfolios by investing in real estate and amidst the pandemic, it continues to be a stable asset. Rahul Purohit, Principal Partner & Head (India Sales) at Square Yards, opined that southern cities such as Chennai, Bangalore and Hyderabad have historically been more resilient towards market circumstances while adding that Southern cities have been comparatively less speculative in comparison to counterparts in northern India. He added that this has reaped the rewards for Southern cities in times of exigencies in the market. He also added that there is a visible inclination towards villa projects and bigger homes in South India and this has increased in post-COVID times, leading to a major rise in demand for the luxury realty segments in key cities. Bangalore and Hyderabad have seen sales growth for properties priced at Rs. 1 crore and upwards and also in sales of ultra-luxury units priced from Rs. 5 crore and upwards according to him.
In the near future, luxury residential units are expected to keep seeing the present momentum strongly. Sales volumes went up by a whopping 140% along with enquiries for Q4 2020 at leading real estate developer Embassy Group and the same can be said for other prominent developers as well. This trend should continue for the next few quarters where NRIs will show more interest along with end-users seeking service-backed or managed luxury residences as per the Group’s officials. Several developers like Brigade have seen sales volumes coming back to pre-COVID-19 levels over the last two quarters in the luxury real state space and this could remain consistent in the near future as well. Developers like Puravankara are bullish about the prospects of the luxury realty sector going forward, taking the performance over the last few quarters into account. The developer feels that the momentum will strongly continue all throughout 2021. The instant success of the World Home Collections luxury offering in Bangalore, a first in the city, has only added to positive sentiments regarding the revival of the luxury real estate market in southern cities. Puravankara will also be replicating the same model in Chennai for the near future along with Mumbai over the upcoming quarters.
For a detailed report on this read the articles we were featured in:
The Financial Express – http://bit.ly/39oIWyN
Published Date: January 27, 2021
