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The annual Luxury Outlook Survey 2024 by India Sotheby’s International Realty (ISIR) has revealed economic optimism among High-Net-Worth Individuals (HNIs) and Ultra High-Net-Worth Individuals (UHNIs). A staggering 79% expressed confidence in the Indian economy's positive course for 2023-24, showcasing a significant leap from the previous year's 59%.
Despite a steep approximately 40% rise in property prices over the last 24 months and an increase in mortgage rates, an impressive 71% of respondents intend to dive into real estate in the next 12-24 months. This signals not just confidence but trust in the market's resilience.
The survey highlights a shift in the motivations for real estate investment. Capital appreciation has taken center stage (44%), marking a return of investors with a focus on long-term gains rather than immediate lifestyle upgrades.
Amit Goyal, Managing Director of India Sotheby’s International Realty, believes that India is confidently shaping its destiny, with projections of becoming the world’s third-largest economy by 2027. The country's central bank, RBI, is optimistic about a 7% GDP growth in 2024.
Luxury properties seem to be the ideal choice. The survey suggests that the top end of the real estate market is poised to benefit the most in the coming 12-24 months. Since the number of wealthy individuals is predicted to almost double to 100 million in three years, real estate becomes an attractive option for building long-term wealth.
The survey also touches upon the belief among HNIs and UHNIs that the Reserve Bank of India (RBI) will start reducing interest rates in 2024, hinting at a positive mortgage and financing outlook. An astonishing 83% of affluent Indians own multiple luxury properties, showcasing a trend of diversified real estate portfolios among the elite.
The survey sheds light on the diverse real estate assets owned by respondents. Beyond primary residences, they boast commercial real estate (34%), holiday homes (25%), agricultural land (21%), and farmhouses (20%).
Goa seems to be the preferred destination for holiday homes, with 35% expressing their desire to own property in this vibrant coastal state. Meanwhile, the desire to invest in overseas property remains stable at 12%, with Dubai UAE and the USA maintaining their positions as top choices.
The shift to digital mediums is evident, with 34% of UHNIs and HNIs embracing 3-D virtual reality and walkthroughs to research and view properties. This underlines the impact of digital transformation even at the pinnacle of the luxury housing market.
As the economic momentum rises and India's elite look towards real estate for long-term gains, 2024 promises to be a year of unprecedented growth in the luxury property landscape.
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