New Delhi. On one hand, the common investor, in search of more profits, sometimes runs towards gold and sometimes places bets in the stock market. But to earn huge profits, the rich people of India and abroad have now started investing their money in an option which neither shows fluctuations like gold nor uncertainty like the stock market. High-net-worth individuals (HNIs), large family offices, NRI investors and foreign funds are investing heavily in this investment option. We are talking about ultra-luxury residential and premium commercial properties. It has now made its place as the ‘new blue-chip asset class’.
A report by global real estate consultancy Knight Frank and CBRE shows that India’s affluent class is now rapidly moving towards super-prime locations where supply is very low and demand is continuously increasing. In the last few years, luxury and super-prime real estate has given such returns that big investors have started considering it as the most reliable wealth-storage. Lutyens Zone of Delhi, Prime Coastal Belt of Mumbai, Golf Course Road of Gurugram and select micro-markets of Bengaluru have become the hottest investment destinations at present. Property is scarce here, and this rarity has pushed prices up.
Why are prices rising?
There is almost no space left for new projects in super-prime locations. Due to less supply and more demand, prices naturally go up. Land in these areas is hardly available in the market, and this is the main basis of their price. Luxury properties offer consistent rental returns, with commercial space offering rental yields of 6–10%. Multi-national family offices and NRI investors continue to raise money in India’s super-prime micro-markets. Such properties are not bought for sale, but as safe capital for future generations.
Luxury property is reliable wealth storage
Suresh Garg, CMD, Nirala World, says that while supply is limited, both ultra-luxury residential and top-end commercial segments are delivering strong annual growth. This asset class has become not just a symbol of lifestyle but also a reliable ‘wealth-storage’ instrument. Dinesh Jain, MD, Exotica Housing, says that in super-prime areas where there is very little scope for new development, the value of high-end commercial space naturally increases rapidly. Investors buy these with the assurance of stable rental income and long-term appreciation.
Himanshu Garg, Director, RG Group, says that high-end residential or premium commercial properties are not purchased for short-term gains, but as part of a long-term investment strategy. Big investors find such options extremely suitable for safe and continuous growth of their capital.
Gaurav Sobti, founder of Homegram, says that the biggest strength of the ultra-luxury segment is its buyer profile. The person buying here is not influenced by price fluctuations but by location and rarity. Vaibhav Aggarwal, promoter of Vision Business Park, says that the response of foreign investors in the ultra-luxury market at this time has never been seen before. They consider Indian premium real estate as a high-return and low-risk combination.
