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Luxury Housing- Flavour of the Festive Season

Torbit - October 02, 2022 - - 0 |

Besides the ever green  affordable housing segment, luxury housing is the flavour of the festive season this year. Considering that luxury housing sales across top 7 cities have doubled to 14% of the overall housing sales in H12022, up from 7% in 2019, clearly points out that luxury housing will be a major driver of festive homes.

According to Anarock study, Indian luxury housing has performed remarkably well post-pandemic, with 25000 luxury homes sold in Hi 2022 out of the total home sales of 1.84 lakh units. While the share of affordable housing stood at 31%, the luxury housing notched up14% share, with MMR and NCR emerging as the leading luxury housing markets.

The latest  CII-Anarock survey shows that  luxury properties priced Rs 1.5 crore saw 4% rise in share , up from 6% in pre-covid 2019 period to 10% in H1 2022. The survey has revealed that in view of the home seekers’ preference for luxury homes, 3BHK homes are in highest demand, commanding a share of 44%. The share of 4BHK homes has also risen more than three times from the pre-covid period. 

As per the  latest Anarock data, the average monthly rentals in the prominent luxury micro-markets across the top 7 cities increased anywhere between 8-18% in the last two years. Mumbai’s Worli saw the highest rental growth of 18% in the period – from INR 2 lakh per month in 2020 to INR 2.35 lakh in 2022 for luxury homes of minimum 2,000 sq. ft. area.This was followed by Bengaluru’s Rajaji Nagar, which witnessed a 16% jump in the same period – from INR 56,000 in 2020 to INR 65,000 in 2022. According to Anuj Puri, Chairman, Anarock Group, the pent-up rental demand hitting the market has caused a demand-supply mismatch in many areas, resulting in monthly rental hikes. Most prominent luxury housing markets witnessed double-digit growth in rentals in the last two years.Pre-Covid, average 2-year luxury rental increases at a given time were largely single-digit, between 5-7%.”

Avg. Monthly Rentals: Top Luxury Markets (For 2,000 sq. ft. area)
City Micro Market 2020 (INR) 2022 (INR) % Appreciation (2020 vs 2022)
Bangalore JP Nagar 46,000 52,000 13%
Rajaji Nagar 56,000 65,000 16%
Chennai Anna Nagar 56,000 63,000 13%
Kotturpuram 74,000 84,000 14%
Hyderabad Jubilee Hills 54,000 62,000 15%
HiTech City 53,000 59,000 11%
Kolkata Alipore 60,000 65,000 8%
Ballygunge 88,000 97,000 10%
MMR Tardeo 2,70,000 3,10,000 15%
Worli 2,00,000 2,35,000 18%
NCR Golf Course Ext. Rd 50,000 56,000 12%
Golf Course Rd 70,000 78,000 11%
Pune Koregaon Park 59,500 68,000 14%
Prabhat Road 64,000 69,000 8%

Source: ANAROCK Research

The  capital appreciation in these luxury markets remained in single digits (between 2-9%) in the last two years. Bengaluru’s Rajaji Nagar witnessed the highest capital appreciation of 9%, with average prices increasing from INR 5,698 per sq. ft. in 2020 to INR 6,200 per sq. ft. in 2022.The high demand for luxury housing is resulting in growth in average monthly rentals.

Avg. Capital Prices: Top Luxury Markets
City Micro Markets 2020 (INR/sft.) 2022 (INR/sft.) % Appreciation (2020 vs 2022)
Bangalore JP Nagar 5,698 6,200 9%
Bangalore Rajaji Nagar 13,300 13,900 5%
Chennai Anna Nagar 11,300 11,850 5%
Chennai Kotturpuram 13,500 14,000 4%
Hyderabad Jubilee Hills 6,950 7,400 6%
Hyderabad HiTech City 5,675 6,100 7%
Kolkata Alipore 13,000 13,500 4%
Kolkata Ballygunge 11,350 11,700 3%
MMR Tardeo 41,862 43,000 3%
MMR Worli 38,560 39,350 2%
NCR Golf Course Ext. Rd 8,300 8,700 5%
NCR Golf Course Rd 13,150 13,500 3%
Pune Koregaon Park 11,128 11,600 4%
Pune Prabhat Road 12,500 12,900 3%

Source: ANAROCK Research

 Snapshot 

  • Bengaluru – the luxury residential hotspot JP Nagar saw avg. monthly rentals appreciate by 13% in 2022 over 2020, while capital prices in this period rose by 9%. Likewise, Rajajinagar saw rental prices rise by 16%, and capital prices by 5%.
  • MMR – luxury rentals in Tardeo rose 15% in this period, while capital prices increased by only 3%. Similarly, in Worli, the average monthly rentals for a minimum 2,000 sq. ft. area home increased by 18%, while capital prices saw a mere 2% jump.
  • NCR – rentals in luxury hotspot Golf Course Road increased by 11%, while capital prices saw a mere 3% rise. Likewise, Golf Course Extension Road saw rentals increase by 12% and capital prices by 5% in this period.
  • Chennai – luxury rentals in Anna Nagar rose 13% in this period, while capital prices increased by 5%. Similarly, in Kotturpuram, the average monthly rentals rose by 14% while capital prices rose by 4%.
  • Hyderabad – the luxury residential hotspot Jubilee Hills saw avg. monthly rentals appreciate by 15% in 2022 over 2020, while capital prices in this period rose 6%. HITECH City saw a rental price rise of 11%, while capital prices increased by 7%.
  • Pune – the rentals in Koregaon Park rose 14% in this period, while capital prices increased by 4%. In Prabhat Road, the average monthly rentals rose by 8% while capital prices rose by just 3%.
  • Kolkata – luxury home rentals in Alipore rose 8% in 2022 against 2020, while capital prices increased by 4%. Similarly, in Ballygunge, the average monthly rentals rose 10% while capital prices rose by 3%.

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