Luxury Realty Mkt Takes A Hit
Luxury Realty Mkt Takes A Hit, There Is Visible Dip In Demand Now Being Seen In Luxury Segment
The luxury sector may have been perceived as recession proof. But there is a visible dip in demand that is now being seen in the in the luxury segment as well.
SundayET's survey with global real estate consultancy Cushman and Wakefield (C&W) revealed that average capital values of luxury properties in posh localities across major metros have taken a dip of 10%-20% during the last three months.
Residential rental values for the same segment have also been impacted, with some locations witnessing a drop as high as 20-25%.
Take the case of Delhi, for instance, where residential capital values of high-end properties such as Shanti Niketan, Westend and Vasant Vihar, GK I and II and Maharani Bagh have dropped to 10% over the last three months. Rental values have also followed a similar track and have seen a 6% drop over the same period.
Rajeev Talwar, executive director, DLF agrees to the fact that there has been a genuine drop in this segment.
"A 25%-30% drop has been seen in capital values for these luxury properties. Luxury buyers also plan their investment cycles, hence it is only natural for them too to cut down on spending. Sales are currently going on even in the luxury sector...no segment is unaffected by recession which is a worldwide phenomenon."
The case is similar in other swanky localities in metros. Areas in South central Mumbai such as Altamount Road, Carmichael Road, Malabar Hill, Napeansea Road and Breach Candy have seen a drop of 7% in average capital values during the last three months.
The impact has been more visible in the rental values in these areas where a drop to the tune of 19% is being witnessed whereas locations in South Mumbai such as Colaba, Cuffe Parade, Nariman Point and Churchgate have seen a drop of 12% in rental values over the same period.
Niranjan Hiranandani, MD of Mumbai-based Hiranandani Developers feels that there has been a temporary respite in demand in this segment. "Demand has not taken a dip...it is a temporary phenomenon. There has been a drop of 10-20% in capital values for luxury buys. People are basically postponing their buying decisions and waiting for liquidity conditions to improve."
Kolkata, however has seen more of a drop in residential rental values in the high-end segment. Areas such as Southern Avenue and Dover Lane in South Kolkata have seen a sharp drop of 20% during the last three months.
While sought after locations such as Ballygunge, Queens Park and Gurusaday Road have seen a drop of 12% during this period.
The drop has been slightly more in South West locations like Alipore Park Road, Ashoka Road and Belvedere Road which are seeing a drop of 22% in rental values. Average capital values, though, have not seen much of a change during the same period.
On the contrary, down south in Bangalore, it is more of the capital values in the high-end segment that have taken a beating. Sought after areas such as Lavelle Road and Richmond Road in central Bangalore have gone down by 9%. Residential rental values for the high-end properties in the same locations have however not been affected during this period.
Hyderabad is seeing more of a decline in residential rental values in the previous three months. While posh Banjara Hills in central Hyderbad has seen a marginal drop of 4%, other locations such as Jubilee Hills also in central Hyderabad have seen a drop of 5%. Average capital values have, on the other hand, increased by 5% in these locations.
Residential capital values for the high-end segment in Chennai have seen a drop of 7% in R. A. Puram in South Chennai while it has been only 1% in Boat Club. There has been no change in rental values for the same period.
Similarly, Pune's capital values have remained unaffected in most desired locations such as Koregaon Park and Bundh Garden in North East Pune.
Source: Economic Times Luxury real estate market takes a hit
The luxury sector may have been perceived as recession proof. But there is a visible dip in demand that is now being seen in the in the luxury segment as well.
SundayET's survey with global real estate consultancy Cushman and Wakefield (C&W) revealed that average capital values of luxury properties in posh localities across major metros have taken a dip of 10%-20% during the last three months.
Residential rental values for the same segment have also been impacted, with some locations witnessing a drop as high as 20-25%.
Take the case of Delhi, for instance, where residential capital values of high-end properties such as Shanti Niketan, Westend and Vasant Vihar, GK I and II and Maharani Bagh have dropped to 10% over the last three months. Rental values have also followed a similar track and have seen a 6% drop over the same period.
Rajeev Talwar, executive director, DLF agrees to the fact that there has been a genuine drop in this segment.
"A 25%-30% drop has been seen in capital values for these luxury properties. Luxury buyers also plan their investment cycles, hence it is only natural for them too to cut down on spending. Sales are currently going on even in the luxury sector...no segment is unaffected by recession which is a worldwide phenomenon."
The case is similar in other swanky localities in metros. Areas in South central Mumbai such as Altamount Road, Carmichael Road, Malabar Hill, Napeansea Road and Breach Candy have seen a drop of 7% in average capital values during the last three months.
The impact has been more visible in the rental values in these areas where a drop to the tune of 19% is being witnessed whereas locations in South Mumbai such as Colaba, Cuffe Parade, Nariman Point and Churchgate have seen a drop of 12% in rental values over the same period.
Niranjan Hiranandani, MD of Mumbai-based Hiranandani Developers feels that there has been a temporary respite in demand in this segment. "Demand has not taken a dip...it is a temporary phenomenon. There has been a drop of 10-20% in capital values for luxury buys. People are basically postponing their buying decisions and waiting for liquidity conditions to improve."
Kolkata, however has seen more of a drop in residential rental values in the high-end segment. Areas such as Southern Avenue and Dover Lane in South Kolkata have seen a sharp drop of 20% during the last three months.
While sought after locations such as Ballygunge, Queens Park and Gurusaday Road have seen a drop of 12% during this period.
The drop has been slightly more in South West locations like Alipore Park Road, Ashoka Road and Belvedere Road which are seeing a drop of 22% in rental values. Average capital values, though, have not seen much of a change during the same period.
On the contrary, down south in Bangalore, it is more of the capital values in the high-end segment that have taken a beating. Sought after areas such as Lavelle Road and Richmond Road in central Bangalore have gone down by 9%. Residential rental values for the high-end properties in the same locations have however not been affected during this period.
Hyderabad is seeing more of a decline in residential rental values in the previous three months. While posh Banjara Hills in central Hyderbad has seen a marginal drop of 4%, other locations such as Jubilee Hills also in central Hyderabad have seen a drop of 5%. Average capital values have, on the other hand, increased by 5% in these locations.
Residential capital values for the high-end segment in Chennai have seen a drop of 7% in R. A. Puram in South Chennai while it has been only 1% in Boat Club. There has been no change in rental values for the same period.
Similarly, Pune's capital values have remained unaffected in most desired locations such as Koregaon Park and Bundh Garden in North East Pune.
Source: Economic Times Luxury real estate market takes a hit