June 20, 2024

Is luxury real estate a good investment option?

Real estate has emerged as an investment vehicle that offers investors real returns – whether apartment resident events  or commercial property. Today, investors are eyeing lucrative options to diversify their portfolios and make their money work for them. One such distinguished investment asset is the luxury real estate market.

Luxury is often perceived as something expensive. However, luxury simply deviates from what is conventional in an appealing manner. As a result, the market value of luxury real estate attracts more investments than ever as people are more open to paying for something exceptional.

A key driving factor that has been evoking a keen interest in investors is location. Wealthy buyers are always on the lookout for promising locations that offer easy support to their lifestyle choices. From fine-dining to high-end shopping, the affluent buyer is more inclined toward locations with easy access to a neighbourhood that meets all their needs and wants. On the other hand, luxury buyers run after beautiful views amidst leafy environs.

Real estateinvestors look for amenities like privacy and security, sometimes away from the city’s hustle and bustle. They value quality living and prioritize detailing, luxury finish and location. According to a recent survey, HNIs and ultra-rich investors look forward to investing in the property market, especially in the property segment of over Rs 5 crore. In addition, NRIs are investing in the outskirts of the metro cities. Borderlines of towns like Gurgaon, Delhi and Noida have witnessed many such investments.

Real estate investors are showing great affinity towards the commercial segment of the luxury property market. As a result, the metropolitan cities are brimming with office spaces and retail showrooms in good locations. During the last two years, we saw several luxury investors cash in on such opportunities due to the slowdown induced by the Coronavirus pandemic.

Owing to the low-interest rates and easy loans for investment in luxury properties, the luxury market investors have successfully acquired high-value assets. Gone are the days when buyers used to invest in conventional investment vehicles such as Fixed Deposits, Equity markets and Gold. Low returns offered by traditional investment instruments have pushed investors to try the luxury real estate market.

Ready-to-move-in properties are going to lead the luxury real estate market. As a result, luxury investors are steering clear of under-construction properties and are always on the lookout for immediate asset acquisition.

Given the number of ready inventory by real estate developers, 2022 is the best time to invest in luxury real estate projects and offers investors profitable luxury investment options. Moreover, Luxury real estate investment will prove to be more beneficial than investments in securities, given their tangible nature.

As the real estate market revives and picks pace in 2022-23, luxury real estate investment opportunities will arise and boost the overall real estate recovery cycle.