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Bengaluru: Besides developers and ancillary services providers, real estate agents are making merry with demand for high-end properties scaling record heights this year.
Brokers and consultants dealing in ultra-luxury real estate, priced at Rs 3 crore and above, cited at least a 20 per cent year-on-year surge in their incomes so far this year. This comes on the back of increased queries and a befitting supply of sales listings, they said.
Furthermore, they expect to close the financial year with stronger numbers, as the festive season traditionally ropes in a higher number of deal closures during the year.
Remarkably, the India arm of global luxury property consultancy Sotheby's, is aiming to more than double its sales turnover to $1 billion this year, as against $450 million clocked in FY23. What makes this ambition more interesting is that owing to a selective approach, the consultancy lists less than 150 properties a year.
The industry norm amongst real estate brokers and consultants - who are often considered indispensable to the business, owing to high distrust and lack of procedural knowledge amongst property buyers - is to charge 1 per cent of the deal amount from the buyer and 1-2% from the seller or developer, in commissions.
The clientele for this segment of professionals entails the who’s who from different walks of life, ranging from business, film and medicine to politics, bureaucracy and so on.
Hem Batra, proprietor of realty consultancy South Delhi Builder Floors, attested to a 50 per cent annual surge in queries for high-end properties this year.
“The developers are also responding very efficiently to this demand, with continuous supply. In fact, at this moment I don’t see any piece of land which is available to be sold in the market (New Delhi) for more than about 2 months of time,” Batra added.
According to data from property consultancy Anarock, total residential sales across the top-7 markets in India registered a 118 per cent jump in the Rs 2.5 crore-plus bracket, during the January-September period this year, compared to the same period in CY 2022.
Meanwhile, properties priced above Rs 40 crore registered a staggering 247 per cent surge in sales value, at Rs 4,063 crore, as against Rs 1,170 crore in the last calendar year. Mumbai took centre stage, accounting for 53 units out of the total 58 sold in the top-7 markets so far in 2023. Interestingly, three out of the 53 deals fetched more than Rs 200 crore each.
Money follows FOMO
“Among wealthy Indians, there is a very distinct FOMO (fear of missing out) aspect to securing the most desirable options before someone else does,” Anarock Group Chairman Anuj Puri opined.
Furthermore, bolstered by the demand numbers and trends, real estate developers are also broadening their drawing boards. New-Delhi headquartered Eros Group is currently mulling a project comprising 5-7 bedroom housing units, across a 6,500 square feet area each.
“We have so far only done 3,4 and 5 bedroom units across a maximum of 4,400 square feet area, in the luxury segment,” Group Director Avneesh Sood told DH.
Following the Covid-19 pandemic, larger space is the priority ask amongst homebuyers. Moreover, the outdoor landscape is now gaining as much interest and attention from customers, as the indoors, industry players said.
“In terms of amenities, fancy bars, a bowling area, salon or spa and even a night club now comprise some common requirements amongst the ultra-rich clientele, for residential projects,” a Bengaluru-based freelance architect said. The professional, who has worked on several high-end residential and commercial projects across southern India, did not wish to be named.
Facilities like a gym, home theater and sports arena are the new bare minimum, so much so that clients do not make a note to mention them as requirement highlights anymore, others pointed out.
“In commercial projects, sustainable construction and green features are in popular demand,” the architect added.
Shedding light on the flip side of the business, Chetan Narain, president and CEO, Narain Luxury Properties India, said: “Besides pricing, Vaastu is the biggest deal breaker in this segment.”
Narain listed land prices, construction expenditure and approval procedures as the top-3 cost factors in these mega projects.
All the consultants who spoke to DH, unanimously agreed that over 90 per cent of these residential purchases are intended for end-use, as opposed to being a pure play investment activity.