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Things to keep in mind when investing in luxury real estate

While the rest of the world is still reeling from the aftermath of the pandemic and the economic disruption it has caused, the Indian saga of resilience and growth paints an inspirational picture. So much so that the International Monetary Fund, in a report released in 2023, gave the country the impressive moniker “bright spot” in a distraught global economy.

In fact, the country today boasts of having the fifth most powerful economy in the world, with its GDP projected to reach 3605.00 USD Billion by the end of 2023. While factors such as the country’s liberal foreign investment policies and dedicated initiatives such as Smart Cities to propel infrastructure development have surely contributed to the country’s economic success, we cannot ignore the real estate sector’s role in the country’s transformative economic journey. Today the sector is the second-largest employer in the country and is projected to contribute 13% of its GDP by 2025.

It’s no wonder then that the investment ecosystem has never been as propitious as it is in the contemporary era. In particular, the post-pandemic era has been particularly kind to the luxury housing sector, with the segment witnessing a significant surge. A report from Anarock Group reiterates this sentiment, with the luxury segment accounting for 18% of the total residential units sold in the top 7 Indian cities in 2023, as opposed to 7% in 2019.

However, while investing in luxury real estate is an opportune proposition, with opportunities for equity and capital gain multiplying manifold in recent years, it is also crucial that investors understand the importance of selecting the ‘right’ asset. In this blog, we will delve into an array of factors that you must take into consideration before securing your next luxury residential project so that you make a decision that remarkably benefits your portfolio.

Mapping your investment goals

Are you buying a luxury space for your personal use? Is it for investment purposes? Are you looking for a short-term investment wherein you flip the property and sell it for profit? Or are you simply looking to rent the space to ensure a stable, long-term source of income? These are the questions one must seriously ponder before embarking on their investment journey.

Once you have a clear understanding of the whys, you must consider the how, which is how you intend to finance the property acquisition. For instance, if you are planning to simply sell the space, you might consider a short-term loan, which can be easily offset by its sale.

Knowledge is currency

One thing that is a must before you advent on your property hunt is conducting thorough research. A comprehensive market analysis will help in gaining a deep understanding of the real estate market, providing you with insight into various variables that determine when is the right time to invest. Complete research on the housing market includes but is not limited to investigating the market value of the other residential assets in the vicinity, their appreciation trend in the last decade, etc.

Further, you need to be up to date on any and all developments that might take place in the present or future to properly apprise the asset’s potential. This is crucial because an asset’s value is keenly interconnected with the social infrastructure ecosystem it is situated in. Additionally, you need to conduct an exhaustive investigation into the constructor to ensure that they are reliable and competent. This includes certifying they utilise high-quality furnishings, deliver projects on time, project authorisation, etc. Investing with brands such as Ganga Realty will ensure that you are investing in luxury residential projects that are of premium quality and equipped with top-of-the-line furnishings while having peace of mind due to the impeccable reputation of the real estate pioneer.

The location factor

While investing in real estate efforts is often considered a stalwart defence against inflation, for the investment to reach its latent potential, it is paramount that it be situated in a strategic location. For instance, imagine choosing a palatial luxury home with an awe-inspiring view of nature. Now imagine it being situated in the middle of nowhere, with absolutely no social infrastructure, and you would soon come to realise why the significance of location in choosing a residential asset cannot be overstated. It stands as the cornerstone upon which the entire investment’s potential rests. The location dictates not only the present quality of life but also the future value and demand for the property.

A strategically chosen location, with access to essential amenities like transportation hubs, shopping centers, healthcare facilities, and good road networks enhances convenience and attractiveness to potential occupants. Proximity to quality schools, recreational spaces, and cultural attractions further elevates the appeal. Unlike the malleability of a property’s interior, the location is immutable; it profoundly impacts not just the property’s value trajectory but also the lifestyle it affords. A judicious selection aligns investment goals with market trends and growth potential, translating into enduring value appreciation and a wise investment decision.

A location that is increasingly becoming one of the most favoured investment destinations for luxury homes is Millenial City, Gurugram. This is simply because the city has a compelling compendium of elite social institutions such as hospitals, educational institutions, and world-class recreational avenues. In addition to this, the vibrant city hosts buzzing IT and business hubs that are home to many Unicorn and Fortune 500 companies, drawing millions of rising middle-class employees who are looking for the best luxury apartments in Gurguram to match their rising status and aspirations.

 Evolving residential demands

 While the demand for luxury housing is on the rise, particularly after the pandemic relegated all to the confines of their residences, it is paramount to be cognizant of the fact that the definition of luxury itself has evolved. Today, the emerging middle class, which accounts for the largest segment of consumers of luxury residential spaces, demands living spaces that are the epitome of comfort, sophistication, and tranquillity. They want their homes to reflect exclusivity and their discerning taste. Therefore, opulent amenities ranging from lavish spa facilities and state-of-the-art fitness centres to elegant entertainment spaces are a must.

Equally crucial is the assurance of safety and security measures that provide residents with a serene sanctuary amidst a fast-paced world. Advanced surveillance systems, gated entrances, and professionally trained staff instill a sense of confidence, allowing homeowners to fully indulge in the pleasures of their private oasis.

A CBRE South Asia report revealed a whopping 151% YoY rise in demand for luxury housing in the first quarter of 2023, with the National Capital Region witnessing a stupendous 216% rise in sales during this period. Further, with Savills affirming a 28% YoY rental appreciation in luxury residential homes in Gurugram, the city has been reaffirmed as the top and most chosen location for luxury housing with heterogenous offerings, from luxury apartments to independent floors.

Final thoughts

In the realm of luxury real estate investment, careful consideration is paramount. As you navigate this exclusive market, remember to prioritise location, market trends, and long-term potential. A well-informed approach will empower you to make savvy decisions, ensuring both prestige and profitability in your luxury property ventures. Armed with the insights from this blog, it is clear that if you are looking to invest in luxury residences, Gurugram, with its robust social infrastructure, thriving work ecosystem, and booming real estate market, is the ideal locale.

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