‘Demand for luxury second homes surges after hiatus’

Light on pocket: Home loan affordability on softer rates also spurred purchases, says Parag Munot.   | Photo Credit: SAMPATHKUMAR G.P.

The demand for luxury second or holiday homes has recovered after a lull since demonetisation of 2016 following pandemic related dynamics such as work from home (WFH) and living away from crowded residential areas, according to some real estate developers.

Luxury villa developers said the demand had risen significantly on account of the pandemic-related dynamics with the average number of deals rising threefold compared with the pre-COVID period.

This small but niche segment had been witnessing price appreciation in the range of 5 to 12% as high networth individuals (HNIs) were acquiring new prime properties in scenic locations in search of health and wellness away from COVID-19 hotspots, where they were based.

“In the residential segment, the pandemic has had positive impact on the second home market which was not moving,” said Sanjay Dutt, MD& CEO, Tata Realty & Infrastructure Ltd.

“We did extremely well last year with our luxury villa project Tata Prive in Lonavla/Khandala. It was completely sold out in the price bracket of ₹4 crore-₹6 crore per home.”

“This year also we have done equally well at our other project Tata Myst in Kasauli. All homes in the price range of ₹2.5-₹5 crore are sold out,” he added.

“We have seen a price increase of 5% this year and the next year, prices will again rise by 7% as people are now looking for new wellness homes,” Mr. Dutt added.

Amoda Reserve-South Park, a luxury villa project in a gated community developedby Kalpataru Ltd. at the foothills of Sahayadri mountains at Kunegaon in Lonavala has also attracted the rich and famous to secure high quality living amidst nature and away from city life. Some buyers have permanently shifted and made their second homes as primary home working remotely to avoid the pandemic.

At this project, luxury homes are priced between ₹4 crore and ₹20 crore and even above.

“Holiday homes are witnessing a strong demand as more and more people seek the relative safety of less crowded spaces, green surroundings and fresher air,” said Parag Munot, MD, Kalpataru Ltd.

“The emerging culture of work-from-home and improved tele-connectivity are incentivising people to make these homes their permanent abode. Lonavala particularly is a big gainer in this regard, due to its short driving time from Mumbai and Pune. Enhanced affordability due to interest rate softening and various schemes is also a key decision enabler,” he added.

“The demand for second homes have been their highest in the pandemic period, and we are witnessing more and more people relocating permanently given the increasing prevalence of teleworking,” he further said.

The buyers in such projects include CXOs, NRIs, businessmen, industrialists, lawyers, doctors, IT professionals and self-employed professionals.

Another second home development firm Nirvana Realty said in six months, it had sold more than 100 units at its Signature Resorts in Khopoli and Wada.

“We are overwhelmed by the response,” said Punit Agarwal, CEO, Nirvana Realty.

“Both our ready-to-move in and under-construction units are in demand,” he added.

Analysts said the safety aspect to deal with the pandemic has acted as a force multiplier

“The second home market appears to be on a gradual upswing. Unlike earlier when capital appreciation and rental incomes were the governing criteria, an additional dimension of a safe home away from the pandemic hotspots appear to have become a key consideration,” said Shveta Jain, MD Rental Services, Savills India.

“Technology too has played a vital role in strengthening investor confidence,” she said.

As per a Savills India recent survey Goa and Maharashtra led the domestic demand for second homes and 70% respondents of the survey said they would buy a second home in two years.

While locations like Alibaug, Lonavala, Karjat, Pavana and even Goa being the top choices for second home seekers from Mumbai, in Bengaluru the emerging hotspots include Nandi Hills and Jigani area near Bannerghatta National Park.

Near Chennai, major second home destinations include Mahabalipuram and Kovalam Main Road on ECR with beachfront properties while in Hyderabad, Srisailam Highway and Kadthal are preferred ones.

Pune shares with Mumbai some of the demand for second homes in Lonavala

Our code of editorial values

This article is closed for comments.
Please Email the Editor

Printable version | Oct 27, 2021 4:10:19 AM |

Next Story