Luxury house sales, priced ₹4 cr and above, grow 38% in 2024

India's luxury housing segment, units priced at ₹4 crore and above, witnessed significant growth in sales, showing an approximate 37.8% year-on-year increase during the January-September period in 2024, according to property consultant CBRE.

Total sales of luxury units during the first nine months of this year stood at around 12,625 units compared to 9,160 units during the same period last year. Delhi-NCR, Mumbai and Hyderabad emerged as prominent markets, accounting for nearly 90% of the total luxury housing sales across the top seven cities.

In terms of quantum luxury residential unit sales, Delhi-NCR topped with sales of around 5,855 units, a 72% Y-o-Y increase, followed by Mumbai at 3,820 units, recording 18% Y-o-Y growth.

A similar trend prevailed during the September quarter in the luxury housing segment across the top cities, registering an 82% Y-o-Y increase in sales. The quarter witnessed total sales of 4,360 luxury housing units compared to 2,390 units during the same quarter last year. During the quarter, cities including Delhi-NCR and Mumbai dominated housing sales, collectively accounting for about 90% of total sales. Moreover, Kolkata saw a notable 1.6-fold increase in luxury residential sales.

The surge in demand for luxury housing has been primarily attributable to a growing preference among affluent buyers for enhanced amenities and more spacious living areas that complement their multifaceted lifestyles. Moreover, the increasing aspirational class has significantly contributed to the increased demand for luxury properties, says CBRE.

The rise in NRI and domestic investors in the Indian real estate market has considerably fuelled the heightened demand for luxury residences, it says.

This trend aligns with the shift in buyer preferences towards high-end units launched by leading developers, as evidenced by the substantial market share of tier-I developers. This shift is anticipated to persist, reflecting the evolving expectations of contemporary homebuyers who are now more discerning and informed regarding developer reputation, execution capability, and financial stability, the real estate consultancy says.

"India's luxury housing market is witnessing significant growth, reflected in an increase in sales. Following strong performance in the first half of 2024 and the seasonal boost during festivals, we expect sales and new launches to exceed 300,000 units for the second consecutive year,” says Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE.

However, elevated capital values in an uncertain global economy may lead buyers to adopt a cautious approach, Magazine says, adding property prices will likely be influenced by unsold inventory, project quality, and infrastructure access.

“We also foresee heightened demand in the high-end and premium segments, with traditional mid-range markets like Noida, Bengaluru, Pune, and Chennai increasingly gravitating towards luxury developments. As the market shifts from bungalows to modern apartments and penthouses, the premiumisation of amenities will be a key differentiator in luxury projects,” says Magazine.