At a time when the stock market is reeling under extreme volatility owing to the geopolitical tensions and Covid resurgence, India’s rich are investing in places perceived safe or offering better taxation rates and business opportunities.
These locations range from Candolim and Assagao in Goa to Medhufaru and Kunfunadhoo islands in the Maldives to Marina beach in Dubai.
In continuation with a trend that kick started last year, rich Indian business families, startup founders and CXOs are putting their money in luxury properties within the country and abroad, places where geopolitical risks are low, luxury real estate development and brokerage firms told Economic Times.
The key reasons behind this trend are the diversification in investments and residency status in another country as part of business expansion. “The strategy is to de-risk by investing in different geographies,” said Ravi Machani, a Bengaluru-based entrepreneur and investor who has purchased a luxury beach house in Candolim and has zeroed in on a luxury villa in Maldives as well.
‘Lifestyle upgrade’
Moreover, a recent survey by Sotheby’s International Realty also indicated that a majority of high net-worth individuals (HNIs) in India are looking to buy luxury residential real estate in the next two years. The main reason for purchasing property during the pandemic is a “lifestyle upgrade”, it said.
“There is a huge cohort of customers who want to buy homes outside their primary city in India and have bought property overseas too, helping us record our best quarterly performance till date,” said Nibhrant Shah, founder of luxury holiday home developer Isprava Group, backed by Godrej Industries chairman and managing director Nadir Godrej, Piramal group executive director Anand Piramal, and Dabur India’s Burman family.
“Dubai has all these positives and a short commute time. Europe for its relative stability is a big attraction, and so is the US,” explained Rohan Sharma, director, research and REIS, India, at international property consultancy JLL.
He added that other factors that add to rich Indians’ wish to buy a luxury property outside include visa-free entry, access to better healthcare and infrastructure, and overall quality of life. “Most locations and countries are offering visa residency status for investment of a certain amount, and in Dubai it is one million dirhams (or about Rs 2.1 crore),” he shared.
Rich Indians buying properties in Goa
Last year, Pinky Reddy, wife of Sanjay Reddy of GVK, bought Palacio Aguada, a secluded prime sea-facing property in North Goa for Rs 80 crore, while Hyderabad-based GS Raju, a third-generation entrepreneur, became the owner of a luxury villa in Goa for around Rs 20 crore.
Mumbai-based couple Suraj Sadanah, who runs a production house, and Manmeet Arora, a fashion designer, relocated to Sangolda in North Goa last year. Ritu Nanda, a Goa-based designer of luxury homes, said, “A sleepy underestimated town, Goa is seeing a sea change in real estate pricing.”
For example, property rate in Assagao has shot up to Rs 50,000 per square metre from Rs 30,000 two years back.
Other prime locations in the country are Ooty, Coorg, Kasauli, Alibaug and Manali.
Dubai, Maldives
Outside India, the uber rich are aiming at property markets of Dubai and Maldives. “Property prices (in Dubai) are up by 50 per cent, especially of villas which are in high demand,” said Viresh Chhabra, managing director of Forest Hills, a brokerage firm for high end houses.
Dubai allows complete ownership and some of the prime locations there are Marina beach front, Creek Harbour, Business Bay, and Hartland.
With more and more rush moving there, “there is a huge shortage of villas in these markets,” Chhabra said. “Since it’s a safe haven with a rental yield of 7 per cent, buyers are willing to pay 1.5 to 2 million dirhams (about Rs 3.5 crore), with ticket sizes of villas going up to Rs 40 crore.”
Further, to cater to the luxury needs of the rich, several luxury residential projects are also coming up in Maldives. Tata Housing is developing two residential projects at Nadhee and Odean in the city of Male. This is the second phase of the development planned by Tata Housing in the Maldives, after the construction of Arabia and Gakoshi in Male by the company.
