Mumbai's Luxury Housing Boom: What's driving the demand for million-dollar homes?
India's Housing Market Thrive due to High Demand for Properties Valued Over 10 Million Rupees: Research Findings
The reported sales of properties priced over a whopping 1 crore in India during Q1 2025 saw a remarkable boost, serving as a safety net for the overall housing market sales that stood at 65,250 units, avoiding a substantial drop. This piece takes a deep dive into the factors fueling this high-end housing demand.
While residential sales during Q1 2025 experienced only a minimal decline, amounting to 65,246 units, it's worth noting that the robust demand in the Rs 3-5 crore and Rs 1.5-3.0 crore segments played a pivotal role in offsetting the sluggish activity in the relatively affordable housing market. This trend, as highlighted by a JLL report, indicates an uptick in affluence among homebuyers, evolving lifestyle preferences, and buyers prioritizing larger, premium properties.
The city trio of Bengaluru, Mumbai, and Pune dominated the sales landscape, accounting for a staggering 66% of Q1 sales. The high concentration of multinational corporations and startups creating numerous job opportunities and ongoing infrastructure development are making these cities increasingly sought-after places to work and live.
Interestingly, recent housing sales trends indicate that a significant percentage is owed to projects launched in the same quarter. Q1 2025 was no exception, with around one-fourth of its sales coming from quarterly new launches, drive by trustworthy developers who guarantee timely delivery and consistent price appreciation.
Dr Samantak Das, JLL's Chief Economist, pointed out that the residential real estate market is witnessing a change in buyer preferences, with a decrease in demand for properties below Rs 1 crore and an increasing preference for mid to high-end properties. This trend suggests a possible upward shift in the overall market dynamics, with the high-end segment demand protecting overall housing sales from a more significant decline.
In a positive outlook, developers are focusing on mid to high-end projects to align with the latest demand patterns. The high-end housing sector experienced a steady upswing, marking a 107% YoY growth in launches of properties priced at Rs 1 crore and above. This growth signals developers' robust confidence in the high-end housing demand, setting up 2025 for a robust market growth in the residential sector.
According to the enrichment data, several factors have contributed to the growth in demand for high-end homes during Q1 2025. These factors include a growing desire for homeownership, increased income levels, infrastructure development, a shift towards luxury and ultra-luxury segments, and economic factors such as lower repo rates. All these factors have created a conducive environment for growth in the high-end property market during Q1 2025.
- Affluent homebuyers in Mumbai are driving growth in the luxury housing market, with properties priced over 1 crore seeing a significant increase in sales during Q1 2025.
- The city of Mumbai, along with Bengaluru and Pune, accounted for a majority of the sales in the high-end housing market during Q1 2025, largely due to the concentration of multinational corporations and improved infrastructure.
- Developers, especially those known for timely delivery and consistent price appreciation, have contributed to the surge in high-end housing demand, with a large percentage of the Q1 2025 sales coming from new launches in the mid to high-end segments.
- To counterbalance the slow growth in affordable housing, MNCs and finance institutions are investing heavily in the housing-market and real-estate sector of Mumbai, providing a financial boost to the high-end housing market.
