High-end residences are fueling demand in India’s residential market across major cities. In Mumbai, properties priced above Rs 10 crore saw a 49% increase in value, reaching Rs 11,400 crore during the January-June 2023 period, up from Rs 7,660 crore in the same period last year, as reported by India Sotheby’s International Realty and CRE Matrix. Similarly, Delhi NCR experienced a remarkable 216% surge in the sale of luxury houses between January and March 2023 compared to the first quarter of the calendar year 2022.
According to CBRE’s research, there has been a significant surge in sales in various Indian cities, with Delhi-NCR witnessing a remarkable increase of over 216%, Mumbai by 44%, Hyderabad by approximately 800%, Kolkata by 100%, and Pune by nearly 13 times on a year-on-year basis for the quarter ending January-March 2023.
For instance, DLF circulated a letter stating that at Magnolia on Golf Course Road, a 6,400 sq foot apartment was recently sold for Rs 32.6 crore, while at Camellia’s, a 7,400 square foot apartment was sold for Rs 50 crore. In The Crest, also on Golf Course Road, the resale of flats is around Rs 13 crore, and the rentals are at Rs 2.5 lakh to Rs 3 lakh per month. In 2020-2021, the resale was at Rs 6.5 crore to Rs 8.5 crore.
These sales have led to a surge in rentals for super luxury flats on Golf Course Road. Within just three months, Magnolias rentals have increased significantly from Rs 5.5 lakh to Rs 6.5 lakh, and Aralias rentals in the same period have risen from Rs 4 lakh to Rs 5 lakh for a 5,800 sq ft apartment. The rental value of a 9,500 sq ft apartment at Camellias has soared to a remarkable Rs 14-15 lakh a month from Rs 9.25 lakh just 18 months ago.
“Capital appreciation in Delhi NCR was observed at 40% on a year-on-year basis at the end of 2022 compared to 2021. Rentals are following the same trend and increasing proportionally due to limited move-in inventory but a decade-high demand. In Gurugram, the ready-to-move-in inventory was only 1,433 units valued at Rs 2,885 crore, while the under-construction inventory is around 9,912 units valued at Rs 23,104 crore. This indicates a significant shortage in ready-to-move-in properties, especially in the luxury segment. On Golf Course Road, since 2018, only DLF Crest and DLF Camellias have been completed, and the inventory in these projects is limited,” said Samir Jasuja, Founder & CEO, PropEquity.
In March, DLF successfully sold out a luxury project on Golf Course Extension, generating presales worth Rs 8,000 crore for the group. The Arbour project was priced at Rs 18,000 per sq ft.
“The luxury residential market in Delhi-NCR has been experiencing an unprecedented surge in recent times. The demand for spacious homes with state-of-the-art amenities has been a driving force in this flourishing market. The increasing aspirations of buyers have significantly influenced sales, and this trend is expected to continue in the upcoming quarters,” said Shveta Jain, Managing Director of Residential Services at Savills India, a property consulting firm.
Average rentals experienced a year-on-year increase of 28%. Golf Course Extension Road and Golf Course Road exhibited the most substantial growth in rentals, with 33% and 31% year-on-year growth, respectively, during the first half of 2023, according to data from Savills India.
The ongoing development of infrastructure projects nearing completion, such as the Delhi-Mumbai Expressway, Delhi-Meerut Regional Rapid Transit System (Delhi-Meerut RRTS), and Dwarka Expressway, is anticipated to enhance overall connectivity in the region with other parts of the country. This improvement is expected to attract both end-users and investors seeking to invest in ultra-luxury residential properties.
The Haryana Government has raised circle rates for certain sectors and commercial areas in the Gurugram district. Sectors along the Golf Course Road, SPR, and Dwarka Expressway have seen circle rate increases of up to 30%, while the circle rates for commercial areas have been raised by approximately 10%.
“New Gurugram and Dwarka Expressway, registering year-on-year increases of 40% and 29%, respectively, stand out as the two micro-markets witnessing the most significant surge in capital values for under-construction properties during H1 2023. This surge is primarily attributed to the establishment of new price benchmarks through the introduction of upscale projects by reputable developers and the heightened demand for new properties featuring ultra-luxurious amenities,” as stated in a report by Savills India. Recently, Godrej Properties secured the top bid to develop two group housing plots in the Golf Course Road micro-market through an e-auction conducted by the Haryana Shehri Vikas Pradhikaran (HSVP).”
“Our entry into the prestigious Golf Course Road with two upscale residential projects signifies a significant achievement for Godrej Properties. It aligns seamlessly with our expansion strategy and will further strengthen our position as a leading real estate developer in the NCR region,” stated Gaurav Pandey, MD and CEO of Godrej Properties. In Mumbai, the demand for luxury apartments in the financial capital was primarily fueled by industrialists, Bollywood celebrities, and high-salaried professionals, as indicated by Sotheby’s International Realty. According to the data, sales of luxury housing in the primary (fresh launch) market surged by 83 percent to Rs 8,817 crore during the January-June period, compared to Rs 4,816 crore in the same period of the previous year. However, sales in the secondary (re-sale) market declined by 9 percent to Rs 2,583 crore from Rs 2,844 crore during the period under review.”
“Indians are becoming wealthier, and they are not hesitant to showcase their affluence. The affluent demographic is now seeking larger homes than ever, exhibiting a distinct preference for ocean views, elevated floors, and abundant amenities,” remarked Abhishek Kiran Gupta, CEO and Founder of CRE Matrix. As per the report, the prime luxury micro-markets in Mumbai include Worli, Malabar Hill, Mumbai Central, Lower Parel, Prabhadevi, Bandra West, Tardeo, Mahalakshmi, Andheri West, and Santacruz West. Another noteworthy discovery is that the ‘Ultra-Luxury (Rs 40-70 crore)’ segment experienced a 64 percent growth, with 64 units sold (primary) in the last 18 months (H1 CY’22 to H1 CY’23) in Mumbai, compared to 39 units in the preceding 18-month period of H2 CY’20 to H2 CY’21).”
