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  • India’s ultra-rich are more inclined to invest in real estate for better returns

    Published on June 13, 2024

    By Mr. Amit Mamgain, Director, Yugen Infra Pvt Ltd

    India is shaping its destiny more confidently than ever before, with the world’s fifth-largest economy poised to become the third-largest by 2027. The rising economic momentum is reflected in record-breaking housing sales in Indian real estate in 2023 and an all-time high stock market. The affluent class is expected to nearly double to 100 million people within three years, and India’s ultrawealthy is growing.

    Positivity prevails all over

    Luxury real estate is now a statement of status and purpose, transcending mere acquisition. This trend presents opportunities for the Indian real estate market, as luxury developers can cater to the growing number of Ultra High-Net-Worth Individuals (UHNWIs) seeking prime residential investments. The annual Luxury Outlook Survey 2024 revealed a robust economic optimism among HNIs and UHNIs, with 79% expressing confidence in the Indian economy’s positive trajectory for 2023-24.

    The residential sector is poised for significant growth in 2024, driven by factors like urbanization, rising incomes, and a focus on harmonious living with nature. The growing interest of elites in the residential real estate sector reflects a shift towards quality living spaces that cater to evolving lifestyle preferences. Lifestyle shifts and lifestyle changes are driving demand for luxury and larger homes among India’s elite. The ultra-luxury housing sector experienced a 130% YoY increase in 2023, highlighting the desire for premium living experiences.

    Affluent investors allured by massive returns

    India’s ultra-rich have allocated 32% of their wealth to residential properties, according to Knight Frank’s The Wealth Report 2024. According to the report, Goa was the preferred destination for holiday home buyers. This shift in investment preferences highlights that today’s well-informed and profit-savvy investors realise that real estate is the steadiest and most secure option for highly tangible returns over a long course of time.

    The positive economic sentiment reflects the resilience and potential of the Indian economy, with investors strategically positioning themselves for wealth accumulation and multi-generational wealth creation through real estate investment. Amidst these positive vibes and progressive trends, Goa, the coastal city, is becoming India’s primary destination for luxury properties. Offering a quality environment, picturesque milieu, high-end infrastructure, and a myriad of residential and commercial facilities, Goa not only rewards realty enthusiasts with dream properties but also optimises their investments with low risks and high returns.

    The great going Goa

    Goa is a top tourist destination known for its beautiful beaches, vibrant nightlife, and rich cultural heritage, making it a potentially lucrative investment for hotels, resorts, and holiday homes. The state offers a scenic environment, a relaxed pace of life, and high-quality amenities, making it an attractive choice for second homes or vacation properties. Moreover, the launch of the MOPA airport has provided great momentum to tourism and corporate activities in the region, and its impact is evident in the high rental of residential and commercial properties in Goa.

    Rental yields have historically shown strong capital appreciation due to the constant demand for tourism and limited land availability. Developers are focusing on high-end residential and mixed-use developments, including luxury villas, condos, and gated communities. The government’s policies promote tourism-related infrastructure and real estate development, further boosting investor confidence.

    Additionally, the state’s vibrant social and cultural scenes, along with improvements in connectivity, make it an ideal retirement destination for UHNWIs seeking both personal use properties and investment opportunities with the potential for good returns.

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