India’s Festive Season Sparks a Surge in Luxury Real Estate Demand
In India, the festive season is the beginning of the most auspicious period of the year. Festivals like Dussehra, Navratri, and Diwali mark the victory of good over evil, marking new beginnings. This period is considered especially favourable for investing in real estate assets and traditionally witnesses a momentous upswing in demand, offering attractive discounts and generous offers.
These offers more often than not lead to potential buyers becoming actual ones, incentivizing people to turn their dreams of becoming house owners into a reality. From lower down payments to flexible financial choices, people can make their dreams come true in an economically sound manner. The deeply entrenched cultural significance of the season makes this season ideal for making a residential real estate investment that is emotionally charged as well as financially sound.
Which residential segment is gaining prominence?
A consumer sentiment survey by a leading real estate consultancy reiterates the positive sentiment towards real estate investment, with 59 percent of the homebuyers predisposed to buying mid-range and premium residences, with the price ranging between Rs 45 lakhs and Rs 1.5 crores. This increase in demand will further lead to a surge in reductions in unsold inventories while carrying on the trend of demand for luxurious properties in the country.
The CEO of a leading real estate company reaffirmed this sentiment in a recent interview, in which he stated that the residential real estate landscape in India is primed to grow at a record speed this festive season. Industry experts cite that the real estate sector in major cities like Hyderabad, Pune, Delhi NCR, and Bangalore has been booming in the last few quarters. According to him, it is the luxury real estate sector that will gain the most prominence this festive season, as has been the trend this season, with the Gurugram market spearheading the growth.
Despite the rising property prices and rising interest rates, the equivalence of residential rental and home loan EMIs, a stable repo rate, and the rising disposable income of Millennials, who account for the majority of property buyers this year, have led to a steadily surging demand momentum for residential property in Gurgaon. In fact, an industry report reflects a 10 percent rise in the demand for this budget category of residential spaces.
Why is there a rise in demand and sale of residential units?
Millennials driving the change – It is important to note that it is this inclination of the Millennial generation towards an elevated standard of living, with preference towards spacious homes that have world-class facilities and benchmark security specifications, that the real estate sector in India underwent a significant metamorphosis. Indeed, this generation and their attitude towards residential spaces have permanently transformed the very definition of home. Today, homes are more than just four walls to live in. Rather, they are expansive spaces that are curated to provide maximum comfort and luxury, reflecting the generation’s upward mobility aspirations.
Shifting global economic landscape – Another critical reason why we are seeing an increase in demand and sales of residential units is because real estate assets have always been considered a stable, resilient, and tangible investment avenue as opposed to other investment instruments like stocks and bonds, which are more vulnerable to market volatility. In the current economic climate, with the global economic crisis, the aftermath of the pandemic, and socio-economic turmoil due to wars, a worldwide recession seems like a very real possibility in the near future. This has led to more people than ever turning to real estate as a source of stable, passive income as well as a capital-generating asset.
However, it is worth noting that, as per an industry survey, approximately 67 percent of homebuyers in India are end-users who are buying residential property for their own usage, seeking stability and security in today’s uncertain economic environment.
Final thoughts
India’s festive season presents a prime opportunity for real estate investment, particularly in the luxury segment, driven by Millennial preferences. The stability and resilience of real estate assets, especially in uncertain economic times, further contribute to the rising demand for residential units. As India celebrates new beginnings, many are turning their dreams of homeownership into reality, combining emotional satisfaction with financial prudence.
