Luxury home sales jump 130% in first six months of 2023

The luxury housing segment in India maintained strong sales momentum, registering a year-on-year increase of 130% during the January-June period of 2023, according to a report released by real estate consulting firm CBRE.

Total sales of luxury units during the first six months of the current calendar year stood at 6,900 compared to 3,000 units during the same period last year, the report says.

Among the leading cities in absolute terms, Delhi-NCR, Mumbai, and Hyderabad emerged as prominent markets, combined together accounting for nearly 90% of the total luxury housing sales across the top seven cities.

Hyderabad recorded the highest percentage increase in sales on a year-on-year basis with nearly 14-fold growth with total sales of 1400 units. This was followed by a nearly six-fold increase in sales in Pune and over three-fold jump in Delhi-NCR.

In terms of the quantum of sales of luxury residential units, Delhi-NCR topped with sales of 2,900-unit, marking a 205% year-on-year increase, followed by Mumbai, which recorded sales of 1,900 units, an 18% year-on-year growth, while sales in Kolkata stood at 200 units, a 100% year-on-year increase, and Pune recorded sale of 300-units, registering a 500% year-on-year increase during this period.

The surge in demand for luxury housing was primarily driven by a growing preference for enhanced amenities and more spacious living areas, the report says, adding it is the “aspirational class” that has been on an upward trend and driving luxury sales. The rise in NRI investments in the Indian real estate market has significantly contributed to the heightened demand for luxury properties, it adds.

A similar trend prevailed during the quarter ended June in the luxury housing segment across the top cities registering a 121% year-on-year increase in sales. The quarter saw total sales of 3,100 luxury housing units compared to 1,400 units during the same quarter last year. Among the cities, Delhi-NCR, Mumbai, and Hyderabad emerged as prominent markets during the quarter, while luxury sales in Hyderabad increased by 20 times, it jumped three-fold in Delhi-NCR.

Overall, in the residential sector, during the first six months, a total of 154,000 units were sold, and over 151,000 new units were launched across all categories. During this period, sales increased by about 3% compared to the same period a year ago, whereas new launches recorded a growth of 9%, highlighting a substantial rise in the newly launched residential properties compared to the corresponding period in the previous year. Pune, Mumbai, and Bangalore emerged as the leading cities in terms of sales, accounting for 61% share in total sales in India during the first half of the year.

"We are witnessing an impressive growth and resilience of the luxury housing segment, as evident from the data showing a remarkable 130% increase in sales. This surge signifies the strong demand and positive momentum in the luxury housing market,” says Anshuman Magazine, chairman and CEO - India, South-East Asia, Middle East & Africa, CBRE.

Looking ahead, Magazine anticipates a stronger second half of 2023 in the residential market, supported by factors such as a healthy supply pipeline, the approaching festive season, and stabilising mortgage rates.

“Despite global macroeconomic challenges, we expect the residential sector to maintain robust sales momentum. Additionally, the premium and luxury segments are expected to perform well with new launches, and the volatility in mortgage rates on demand in this segment is anticipated to be limited,” he adds.