People have now understood the rational decision making between the necessities and the luxury things owing to the COVID-19. The people all around the world have recognised the importance of having a luxury home having all the facilities.
Work from home (WFH) as a potential new constant has raised the demand for larger homes that incorporate workspaces. People also want additional facilities such as gyms, yoga rooms, and home theatres to make them fully self-sufficient units.
Savvy millennials who previously preferred renting properties over buying have now adjusted their perception with a focus on acquisition.
Here’s a recap of the trends observed that are structuring the growth of luxury housing:
A significant increase has been seen in buyers seeking properties in elite neighborhoods including Lutyens’ Delhi. Luxury properties in tier-1/metropolitan cities like Delhi NCR, Mumbai, and Kolkata, and picturesque destinations at hill-stations. In any of the above mentioned places the per square feet will cost anything between 8-12 lakhs. Multiple transactions have been successfully concluded in the most elite neighborhoods of Delhi in the last three to four months, which is a great sign of revival of demand in luxury real However, for smaller plot areas, per square yard prices may increase marginally. Malabar Hills, Bandra and Worli have the most elite transactions.
Growing interest in second homes
Buyers are looking for picturesque locations and self-sufficient properties in Goa, Alibaug, Kerala and Uttarakhand etc. Holistic living has a new meaning and paved the path for investing in a luxurious second home.Second-home destinations like Goa, Dehradun and Alibaug have become all-year destinations, and sometimes even primary homes, with the new norm of WFA or work from anywhere. These locations are perfect for the luxury lovers having exceptional outside and inside architecture. These destinations are witnessing a sharp uptick in the resale of standalone bungalows in the Rs 5-15 crore range. A surge is also seen in demand for farmland on the outskirts of large cities and this trend is likely to continue with UHNIs realising the importance of large homes surrounded by nature.
Reduction in interest rates and stamp duty:
The housing interest loans are on a historic low offering attractive home loans at range of 6.75% to 7.5%. Home loans at prevalent interest rates allow for considerable savings while creating an asset for the purpose of end-use or investment. The lower interest rate enables the buyer to raise a higj loan amount, which enables them to have a look at more luxurious and premium options having finer amenities and porche locality. The big pickup in There is a cut in the stamp duty upto 3% till March 31, 2021. Low interest rates coupled with lower stamp duty could keep sales buoyant through-out 2021.
Advantage to NRI:
Earlier this year United Nations released a report on world economy which siggested that economy was very weakened. But their roports also showed that the Indian and Chinese economy are to be rebound by 2021. The Indian rupee depreciated by 10% as compared to American dollar reaching to its highest ever. Value depreciation puts the US dollar to rupee conversion rate at its highest mark ever, coupled with increased FPI flows bringing stability to INR. Due to the US dollar being strong than the Indian rupee the purchasing power of the NRIs is stronger than the Indians.
Countries beating the coronavirus are getting ‘rewarded’:
As we know that there is a growing demand from the NRIs the same way there is also a great demand by the Indians to seek properties in US, UK, UAE, Canada etc. which demonstrates resilience and were able to handle crisis better. The London market has always been a safe place for investment and has seen a considerable bounce back and has been in great demand. The stats from the UK Office for National Statistics shows that there is an increase in the market by 4% as compared to last year and rest of the country increased by 4.9%. Countryside localities like Surrey has been the hot favourite place for investment. There is a waive off for stamp duty until March 31, 2021. In the US people have started to leave the main cities and started living in the suburbs leaving 20,000 places vacant. The Indian UHNI can buy the houses for the right price, the average cost of a British home is more than a quarter million pounds for the first time in history, signifying the continued interest of UHNIs from across the globe in the UK and London property markets. The stamp duty holiday in the UK until March 31, 2021, has also helped fuel this demand. On the other hand, there is New York where residents have moved out of the city to suburbs or smaller cities, leaving over 20,000 apartments vacant. The luxury real-estate has been the silver lining during the pandemic and on the road of recovery of V-shape recovery due to the COVID-19 vaccination, 2021 has been estimated for high values.