India's Luxury Housing Market: A Tale of Two Cities
Bengaluru's luxury housing sales dip despite overall real estate boom, while Mumbai and Pune drive growth
Real EstateLuxury HousingBengaluruMumbaiPuneReal Estate PuneJul 19, 2024
Despite being one of the top real-estate cities in the country, Bengaluru's luxury segment underperformed compared to last year in the same quarter. The city saw a significant drop in luxury housing sales, from 200 units in Q2 last year to just 10 units this year. On the other hand, individuals are investing more in the mid-segment in the city, according to the report.
In contrast, Mumbai and Pune are driving growth in the luxury housing segment. The report attributes this growth to favourable home-buying sentiments, festive season promotions, and significant land acquisitions by developers. These factors are expected to balance supply and demand dynamics and invigorate market activity.
Bengaluru's residential stock has also nearly doubled from 2.9 lakh units in 2013 to almost 6 lakh in Q2 of 2024. The city's most active markets remain South, East, and North. Last year, the city's residential sector witnessed 40,000 unit launches and 55,000 unit sales primarily driven by mid-segment housing.
The report highlights that factors such as rental appreciation, return to office trends, and improved infrastructure have contributed to the city's improved sales. This has also led to a significant drop in unsold inventory to the lowest ever at 10%. By 2030, the residential stock in Bengaluru is expected to increase from 6 lakh units to 8-9 lakh units.
Buyers are looking for thriving physical and social infrastructure, technology-enabled smart houses, facilities and amenities, and apartments with clean and green environments. With the real estate market expected to remain buoyant, it will be interesting to see how Bengaluru's luxury housing segment responds to the growing demand.
CBRE South Asia is a real estate consulting firm that provides expert insights and analysis on the Indian real estate market. CBRE is a global real estate consulting firm that provides a range of services, including transaction management, project management, and valuation advisory services.
Frequently Asked Questions
What is the current trend in India's luxury housing market?
India's luxury housing market is witnessing a strong sales momentum, with a 27% increase from last year in the January to July period.
Which cities account for the majority of residential sales in India?
Bengaluru, Mumbai, and Pune account for 63% share in the total residential sales in India in January-June 2024.
What is driving the growth in the luxury housing segment?
Favourable home-buying sentiments, festive season promotions, and significant land acquisitions by developers are driving the growth in the luxury housing segment.
What is the expected growth in Bengaluru's residential stock by 2030?
The residential stock in Bengaluru is expected to increase from 6 lakh units to 8-9 lakh units by 2030.
What amenities are buyers looking for in luxury housing?
Buyers are looking for thriving physical and social infrastructure, technology-enabled smart houses, facilities and amenities, and apartments with clean and green environments.
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