There was a time when only the affluent or upper middle class would think of purchasing independent houses or villas in an upscale locality. But in the last two years, especially when the coronavirus pandemic started dying down, middle-class millennials have also shown a keen interest in owning independent houses and villas. The factors that are driving them to own independent houses are high income, the country’s burgeoning economy amid the global slowdown, interest in owning properties with work-from-home arrangements, the middle class’s aspirations of larger-than-life living experiences, availing world-class amenities, privacy, hi-tech security systems, etc..
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In research conducted by one of India’s leading real estate services companies, Anarock Group, it was revealed that among the 3.65 lakh units sold across the top seven cities in 2022, around 18% (65,680) were in the luxury category. It was more than double the pre-pandemic (2019) inventory figures when of the 2.61 lakh units sold in the same cities, just 7% (17,740 units) were luxury properties.
The trend became stronger in the first half of the current year and out of the 1.14 lakh units sold in the top seven cities, 25% were in the high-ticket segment. In those luxury properties, a lot of people, including high-net-worth individuals and ultra-high-net-worth individuals preferred independent houses and villas.
Some prominent reasons behind the paradigm shift to independent houses and villas are as follows.
World-class facilities
A lot of buyers are seeking independent houses and villas to experience world-class living features. Dedicated green spaces, personal gardens and lawns, private elevators and gyms, state-of-the-art security systems, home automation systems, voice-control equipment, solar panels on the roof, and energy-efficient appliances are some of the most sought-after features buyers are looking for while purchasing independent houses.
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A lot of buyers coming to developers demand customised facilities, and the developers are cashing in on the opportunity to provide those facilities at a high cost. Luxury housing with home offices, compact swimming pools, dedicated medication rooms, air filtration equipment, touchless toilets, and sinks are some of the upgrades the buyers are ready to pay for to get customised facilities.
Residence with office space
Work-from-home (WFH) culture emerged all of a sudden during the pandemic. People realised that it has certain advantages too, like being the easiest way to maintain social distance, giving more time to family, increasing productivity, having a flexible schedule with zero commute time, and saving money.
For many, it was a blessing in disguise, and they grabbed the opportunity by buying independent houses, which can also be used as offices. These may not be their permanent offices, but they give them the luxury of having temporary office arrangements that are 24X7 available.
Good investment option
Many professionals in lucrative fields such as IT, finance, and product management, as well as numerous NRIs, are demonstrating an eagerness to purchase independent houses as a worthwhile investment opportunity. These purchasers often hold on to these homes for a protracted period of time, reaping sizable returns after a 5-6 year period.
Even if they are not staying in such properties and putting them up for rent, they are getting good rents. These places are generally either well connected by rail, road, or airports or have premium projects coming up nearby. E.g., an upsurge in real estate in the Noida-Greater Noida region is because of the presence of multinational companies, easy access to essential services, good connectivity through roads and metro, and the upcoming world-class airport in Jewar. That’s why A-lister real estate companies like Gaurs Group and Mahagun have dabbled in independent housing projects there.
Burgeoning economy
Unlike many leading global economies which are struggling with the aftereffects of the pandemic, the Indian economy is growing fast. The GDP numbers released in May showed that the economy grew 6.1% in the January-March quarter and 7.2% in FY23, beating estimates. The country’s per capita national income rose from Rs 92,583 crore in FY22 to Rs 98,374 crore in FY23. A strong economy means people are getting richer and can afford to buy independent houses, villas, or condos to maintain a good lifestyle or to get a good return.
If the economy maintains its pace in the next quarter, there is likely to be more demand for independent houses.
Business establishments/natural surroundings are attractions
As India’s economy continues to grow, demand for independent houses and villas is rising. Big business hubs like Mumbai, Delhi and NCR, Chennai, Bengaluru, Hyderabad, and Pune are the most popular cities for property buyers, but others are drawn to beautiful natural surroundings like Goa, Alibaug, Kasauli, and the Nilgiris for their greenery, serenity, and fresh air. Together, these cities are driving up demand for independent houses and villas across the country. With the economy going at the right pace and more Indians getting richer, the demand for independent houses and villas is most likely to increase considerably.
-The author is co-founder and CEO, Basic Home Loan. Views expressed are personal.
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