A growing inclination towards well-equipped spacious homes, holidays homes and villa/plotted developments due to the need for socially-distanced living in the post-pandemic era, has kept the luxury housing segment buoyant despite the pandemic wrecking the real estate sector in the country.
The COVID-19 pandemic has made people realize the significance of owning a home, that can guarantee safety and security. With continued work from home, people are now focusing on spacious homes that can accommodate working areas.
Moreover, as COVID has impacted the stock market, HNIs are now considering real estate a more stable investment option and are actively seeking homes that are well equipped with modern facilities, essential services, and round the clock security.
While the real estate sector was significantly growing and was anticipated to emerge stronger than before, the unprecedented COVID-19 outspread slowed down the growth of this sector. However, being driven by a segment of buyers who are usually not priced sensitive helped the luxury housing segment to stay afloat in spite of the initial hiccups faced during the lockdown.
In fact, certain pandemic-induced trends that emerged in the real estate sector might just augment the growth of luxury housing in the post-COVID era. Let’s delve a little deeper into these trends.
Demand from NRIs and HNIs
The post-pandemic period has witnessed a growing demand for luxury housing from the HNI, Ultra HNIs, and NRI buyer segments. The depreciation of rupees against the dollar, drop in prices of luxury homes and low-interest rates are some of the factors that have attracted NRIs to invest in their home country.
For instance, NRIs from the GCC region have contributed immensely towards the Indian real estate market and these numbers have only gone up since the pandemic.
Buyers are now looking for spacious homes in integrated townships that offer lifestyle features. These are mostly the ones who are either returning to their home country with sizeable savings or have managed to retain their jobs and are looking for rental income.
Demand for Second Homes
HNIs who are looking for good investment options with high rental yields are now focusing on the second homes market. For both the affluent and middle-class whose jobs have not been affected during the pandemic, second homes are now the most lucrative investment option that offers a steady rental income.
According to an industry report, there has been a spike in demand for farmhouses with average monthly transactions going from 2-3% to 10-12% in the last couple of months.
Industry experts believe that buyers are now open to buy high-end homes in the suburbs that were not considered earlier.
Need for Larger Spacious Homes
Another pandemic-induced trend is the need for larger homes. This has worked in favor of the luxury home segment. Luxury home buyers are now actively looking for projects that have extra space or an additional room that can accommodate a study/office or workout space.
The work from a home culture has changed the middle to upper-middle-income homebuyer’s preferences too. They are now less price-conscious and are ready to stretch their budgets and pay extra for expansive residences that have private gardens or extra balconies for maintaining physical and mental wellbeing. This trend bodes well for the luxury housing inventory in the country.
Increasing Demand for Villas and Plots
As per a recent industry report, there has been a rise in demand for plots as they are relatively affordable and offer good returns on investment.
With an emerging need for low-density living and social distancing becoming the new normal independent homes are witnessing a rising demand. Villas offer utmost privacy and security along with the availability of open spaces.
With work-from-home expected to continue in coming years and improved connectivity, homebuyers are now ready to move away from the cities and are willing to invest in a property in the suburbs. Thus, plots and villas are gaining traction as these not only offer spacious living but ensure a healthy and cleaner lifestyle.
“The recent growth in demand for plots can also be attributed to an increase in planned plotted project launches by Grade A developers. Earlier the supply was largely restricted to Grade C and smaller developers with very scattered launches,” believes Tanuj Shori, CEO Square Yards.
Future of Luxury Housing Segment
The luxury housing segment will witness a transition in terms of location and amenities in the coming years. In the post COVID scenario, buyers would prefer high-end homes in the suburbs of the city with excellent connectivity that are less populated.
Moreover, the new ready-to-move-in homes will customize their spaces as per new standards of integrated living and Tier II cities are likely to witness demand for luxury homes. The luxury housing segment will continue to see growth in the next five years from HNIs and ultra HNIs.
Also, Read Branded Luxury Homes – A Cult Combination of Top Developers with International Fashion Trademarks
