Demand for luxury homes on the rise: Ashish Puravankara 

Today luxury home buyers in the country include not just industrialists, high net worth individuals (HNIs), non-resident Indians (NRIs) or the expat community but young entrepreneurs as well, and the real estate developers are lapping it up. Bengaluru-based real estate firm Puravankara Limited points out that the average age group of buying houses has dropped from early 40s to mid-30s. In an interview with Fortune India, Ashish R Puravankara, managing director, Puravankara talks about how the luxury-housing segment in the south has seen a steady rise in last 12-14 months with cities such as Bengaluru, Chennai and Hyderabad contributing to the upswing in luxury projects.

Edited excerpts:

At present how is the demand in the luxury real-estate space in India. Is it driven mostly by end users or investors?

The Indian real estate industry is at the cusp of transformation. In the recent past structural policy reforms have brought a paradigm shift in the industry especially the residential segment. It has witnessed a renewed interest by the customers in both affordable as well as luxury verticals. In the last 3-4 quarters, there has been a steady rise in the demand for luxury projects mainly in the key markets such as Bengaluru, Hyderabad, Mumbai, and the National Capital Region (NCR). Also, cities such as Chennai, Kochi and Pune have also seen healthy demand in the luxury segment. Today’s home buyers’ taste and preferences have evolved. They are well travelled and exposed to world-class luxury projects. Also, the rise in the number of HNIs along with NRIs and expat community the demand for luxury projects is riding on an upward moving curve. Thus, whatever surge in the market we are witnessing for luxury projects is primarily end-user driven.

Which are the key luxury markets for Puravankara? What is typically the price range and type of properties in these markets?

We are a pan India real estate player, and our interest lies in entire length and breadth of country wherever we see a viable opportunity. Having said that, currently we are focusing mainly on the southern and western belts of the country. In the next 10-12 months, we would be launching new luxury projects in Bengaluru, Pune, and Mumbai. We have recently launched two new high-end luxury projects Purva Zenium, Bengaluru and Purva Sommerset, Chennai. Both these projects are launched under our signature residential line BluNex Life- intelligent next-gen homes, which we announced last year in collaboration with Google.

The price of a luxury project depends on various factors such as city, location, nearby infrastructure and the amenities offered. The price tag depends on city and location. For example, our project Purva Palm Beach in Bengaluru situated off Hennur road ranges between Rs 90 lakh to Rs 1.5 crore. Whereas, Purva Grande at Lavelle Road in the same city ranges between Rs 6-10 crore. Similarly, price- range of a luxury project in Bengaluru may not qualify for the same type of project in Mumbai. So it would be a bit difficult to put an exact price range for a luxury project.

How is the demand in the south?

The luxury housing segment in the south has seen quite a decent rise over the last year. In key cities such as Bengaluru, Chennai and Hyderabad, there has been a rise in customer traction when it comes luxury projects. Even tier two cities like Kochi and Coimbatore have shown immense potential in the luxury residential segment. The southern market has an appetite for luxury properties, considering the vast number of white-collar migrants and the NRI factor make it a hot zone for the luxury and uber-luxury segment. Also with better infrastructure and connectivity the demand for luxury homes will only continue to grow in the south.

Has Bengaluru seen a steep rise or dip in luxury pricing in the last one or two years? If so, why?

Bengaluru has seen a 45 % jump (in prices) in the luxury market segment, in the past two years. While the average age group of buying houses has dropped from early 40s to mid-30s, the cost of luxury housing has been steadily moving upward. Also, the advent of Real Estate Regulatory Authority (RERA) has infused a new sense of positivity among the customers, who now have access to necessary information which helps the customer to take a more informed decision. The certainty in terms of timelines and quality has further boosted the demand for luxury housing.

In the luxury space what kind of properties do you look into? If you could share some details.

Our luxury projects comprise of a healthy mix of apartments, villaments and villas, all in the high-end segment. We have always had innovation at the helm of our designs. For example, one of our near completion projects, Purva Palm beach in Bengaluru has been developed on the theme of a tropical beach resort. The project has areas dedicated to a wave pool, Koi pond, and snorkelling zone along with usual amenities such as gym, clubhouse and others. Similarly, Purva Venezia is inspired by the landscape of Venice with arched bridges and manicured gardens. Theme-based townships is catching up fast the imagination of the Indian home and residential real estate sector.

How do you see the affordable luxury segment? Do you feel it has the potential to be the key volume driver in the luxury space?

The affordable luxury or premium affordable homes have emerged as a beacon of hope for aspirational home-buyers in India. The concept has gathered momentum in the last few years with the increase in the number of white-collar migratory population coupled with higher disposal incomes, as the foremost aspiration is to be homeowners. In the last five years, there is a stupendous rise in demand for such homes mainly in the bracket of sub Rs 50 lakh to Rs 65-70 lakh. Realising the growing demand for high-quality, affordable homes in the country, we launched Provident Housing Ltd., a wholly-owned subsidiary of Puravankara, way ahead of the curve in 2008 to meet the aspirations of mid-income and first-time home-owners. Till date close to 20 million sq. ft. of projects have been launched across southern and western cities with close to 10,000 homeowners. Additionally, about close to 10,000 units have been planned for new launches. The premium affordable housing segment holds immense potential for builders, investors and other stakeholders. These homes are popular because they are relatively more pocket-friendly when compared to their ultra-luxurious counterparts.

For a detailed story on India’s luxury real estate market, read Fortune India’s May issue, now on stands.