Premium residential property is back in vogue in India as developers plan more projects to keep up with demand, it is claimed.
Good economic prospects, more jobs and a growth in salaries is leading to an improvement in the real estate sector and in particular demand for high quality, premium housing, according to JC Sharma, managing director of Sobha Developers.
Usually non-resident Indians and high net worth individuals are the main buyers of premium properties. ‘While there seems to be more volatility in western economies, India has shown signs of stability and growth. So, rather than invest anywhere, they find it better to invest in premium housing here,’ Sharma explained.
The company now plans to expand its Sobha Lifestyle Project in Bangalore to launch similar projects in Coimbatore.
‘The profit margin in the premium housing segment is higher than the mid segment housing projects and usually ranges from 25 to 35%. So, rising demand in this space is a good sign of profitability,’ said M Murali, managing director of Shriram Properties.
The sector was badly hit in the last 18 months but has been seeing a growth in demand in the last three to four months. Shriram Properties, which has launched a premium housing project in Vizag, is now planning two more projects in Bangalore and Chennai, Murali revealed.
DLF, the country’s largest developer, is planning to launch its Lower Parel high end housing project soon. Described as Mumbai’s largest luxury residential project, it is expected to have three towers with 1,000 apartments and one of the largest parking lots in the city.
According to global real estate consultancy Cushman and Wakefield, developers are planning to launch about 9,000 homes in the super luxury segment across major cities in India over the next two to four years.
‘In value terms, demand for premium housing has witnessed a growth of 10 to 15% in the last three months and prices have increased on rising demand,’ said Shweta Jain, director of residential real estate at Cushman and Wakefield.
However, said added that the growth in demand was more in metros like Delhi and Mumbai than southern cities.