Luxury Real Estate: Strong Demand Amid Limited Supply, but Prices Won't Skyrocket Forever

The supply of luxury real estate remains limited, especially compared to the growing number of affluent homebuyers across the country. Post-COVID wealth creation has led more people to seek larger homes with better amenities and enhanced living spaces. While these factors indicate sustained demand for luxury housing in the years ahead, it does not mean prices will continue to rise indefinitely, Anshuman Magazine, chairman and CEO for India, South-East Asia, Middle East & Africa at CBRE told HT.com

If you look at the supply of luxury real estate in numbers across Mumbai, NCR, Bengaluru, Hyderabad, Pune, Chennai, these numbers are not large. Compare the supply coming in to the number of people who are becoming wealthier. Right now, it’s like a mismatch, he said in an exclusive interview.

Post-COVID, especially, and because of wealth creation, everybody wants to upgrade their lifestyle, they want a larger space or a place with facilities. These things add up together, and I feel there will be demand for luxury housing for many years to come. However, this does not mean the prices are going to go up perpetually, he said.

Magazine is confident that luxury real estate is here to stay. We may see prices of luxury real estate slowing down in some markets and going up in others. We may see a slowdown in demand in the interim, but overall, the demand will remain for many years, and the supply still has to catch up, he explained.

That said, the supply of luxury real estate remains limited. While significant price increases can slow the pace of sales, as fewer buyers are immediately willing to invest, the overall outlook is positive. Luxury real estate is here to stay, he said.

‘₹100 crore deals are an outlier, not a reflection of the broader market’

Commenting on ₹100 crore plus marquee real estate deals in the country, Magazine said that one shouldn’t treat exceptions as market benchmarks. For instance, if a single property sells for ₹100 crore, it’s an outlier, not a reflection of the broader market. That said, India’s urban population is highly aspirational, with many striving to upgrade their lifestyles and improve their quality of life, he said.

Demand for high-end or ultra-luxury apartments remains small in absolute numbers, but it is steady. Even with moderate GDP growth of 6.5–7.5%, wealth is being created every year, sustaining ongoing demand for luxury real estate, he said.

Real estate, like any market, is cyclical, influenced by factors such as the economy, interest rates, and broader market conditions. Some markets, like Gurugram, have seen significant price increases, while others may remain stable due to end-user demand or slower wealth creation.

In India, it’s no longer possible to generalize for the entire country, or even a city, since different neighborhoods behave differently. For instance, within NCR, Delhi, Gurugram, Ghaziabad, and Faridabad each have distinct dynamics, and even within Gurugram, Golf Course Road performs differently from other areas. Ultimately, prices are driven by the balance of demand and supply, he said.

India’s luxury housing segment witnessed an 85% year-on-year (YoY) growth in the first half of 2025, with nearly 7,000 high-end residential units sold across the top seven cities, according to a joint report by CBRE South Asia Pvt. Ltd. and ASSOCHAM. Leading the luxury surge, Delhi-NCR clocked sales of approximately 4,000 luxury units during January–June 2025, contributing 57% share to the total luxury segment. The region also recorded a threefold increase in sales compared to the same period last year, the report said.

The report said that the surge in luxury housing is being driven by high-net-worth individuals (HNIs), ultra-HNWIs, and non-resident Indians (NRIs). These groups are increasingly turning to premium real estate in India as a stable asset class amidst global uncertainties and a strong US dollar. Buyers are prioritising homes with exclusive amenities, long-term value, and superior construction quality.