Hello, that is Amala Balakrishner, writing from Singapore. This week, I have a look at how India’s rich are anchoring their fortunes in real estate. Enjoy!
This report is from this week’s CNBC’s “Inside India” e-newsletter which brings you well timed, insightful information and market commentary on the rising powerhouse and the massive companies behind its meteoric rise. Like what you see? You can subscribe here.
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The large story
India’s rich could also be emigrating, however they’re preserving a agency grip on their real estate investments in the nation and overseas, a alternative that is fueling a property increase in the luxurious market.
In a recent newsletter, I explored how rich Indians are looking for different residencies overseas for strategic causes, slightly than a everlasting relocation. According to Dhruba Jyoti Sengupta, CEO of Wrise Wealth Management Middle East, many of those high-net-worth people stay bullish on India and allocate round 80% of their investments domestically. A notable portion of this, he added, goes into real estate.
“Indians, by and large, have always had a cultural affinity for real estate,” Himmat Singh, managing director of world luxurious real estate company Christie’s International Real Estate, instructed me. “Traditionally, post-independence, there were limited assets for people in India to invest in and only a small portion of investors played in the market.”
That legacy nonetheless shapes portfolios as we speak, Singh stated.
While definitions vary, people with a net-worth of fifty million to 250 million Indian rupees ($571,000 to $2,855,000) are usually thought of high-net-worth, whereas these with greater than 250 million Indian rupees are thought of ultra-high-net-worth. Affluent people fall in the ten million-50 million Indian rupees vary.
For many, proudly owning a property is a “cornerstone of wealth strategy,” Wrise’s Sengupta stated, including that it serves as each a monetary asset and way of life assertion. Owning residences overseas, whether or not for rental revenue, private stays, or industrial items in which they’ll function their companies, additionally supplies a worldwide footprint.
India’s uber-rich — outlined as the highest 1% of Indian households, or people incomes the highest 40% of revenue — held on to $11.6 trillion or 59.1% of all property held by Indian households, based on information from funding home Bernstein.
Of this, $7.1 trillion, or 61.2%, is parked in real estate and gold, the identical report indicated.
“Rich and poor Indians have historically relied on physical assets,” reminiscent of gold, land and real estate to park their financial savings, Manas Agarwal, vice chairman and analyst at Bernstein, stated.
REITs, homes and industrial items
The lure of real estate lies in long-term appreciation. These advantages usually outweigh the upper prices and decrease liquidity related to the asset class, specialists instructed me.
The capital appreciation on real estate has greater than doubled in worth during the last 4 years, and many have made “a significant return,” Christie’s Singh noticed.
The common rich Indian owns a number of forms of real estate. Real Estate Investment Trusts (REITs) have gotten a preferred instrument given their means to “generate more predictable yields without the operational burden of direct property ownership,” Wrise’s Sengupta stated.
Residential and industrial properties are additionally well-liked. In the primary quarter of 2025, housing costs in India rose 7.7% from the year before, outpacing the U.S., U.Okay. and Australia.
Sales of luxurious homes priced between 60 million and 500 million Indian rupees jumped 88% in the second quarter of the 12 months in contrast with the identical interval in 2024, whereas the variety of launches for such flats grew 40% from the 12 months earlier than, a report by real estate agency CBRE confirmed.
While costs differ throughout cities, $1 million can buy 99 square meters of prime property in Mumbai, information from Knight Frank’s newest Wealth Report reveals. By comparability, the identical quantity is value 32 sq. meters in Singapore, 34 sq. meters in London and New York, 44 sq. meters in Shanghai and 78 sq. meters in Dubai.
Within India, the rich usually personal single-family properties, or a self-contained residential constructing for his or her each day occupancy, in main metropolises like Delhi, Mumbai or Bengaluru. Such properties are usually in a gated group and may price no less than 200 million Indian rupees for a 2,500 sq. toes unit in some elements of Delhi, Singh stated.
Beyond this, additionally they make investments in “palatial” nation properties spanning round 1 to 2.5 acres (43,560 to 108,900 sq. toes) situated outdoors the town, Singh steered. He named Alibaug, a coastal city that may be a two-hour ferry journey away from Mumbai, and Chhatarpur, a city that’s not too removed from Delhi, as locations with such properties.
Homes in India, Singh stated, are more and more held over a 5 to 10 12 months interval following a change in India’s revenue tax guidelines, the place solely positive factors of 100 million Indian rupees are exempt from capital positive factors taxes. This, he added, has resulted in much less speculative investing and is an effective transfer for the long-term stability of India’s property market.
For property investments outdoors India, the rich take into account performance and long-term returns, Singh noticed.
Dubai is a well-liked location given its sturdy rental yield of 6% to 7% as extra corporations relocate or develop there, he stated. Other well-liked locations embrace Ras Al-Khaimah in the UAE, an up-and-coming metropolis that’s set to generate substantial near-term positive factors, Thailand’s Phuket and Koh Samui, the place Indians go to to loosen up and unwind, in addition to London, the place many head to out of familiarity.
Beyond real estate
But it isn’t simply real estate. The analysts I spoke to stated that India’s rich are additionally investing in different property.
They are actually wanting past bodily property to capital markets, given “how strong they have been in the last few years,” Bernstein’s Agarwal stated.
Private markets reminiscent of venture capital, personal fairness, and hedge funds have additionally emerged as a preferred choice with many rich people funding international start-ups to faucet into the expansion they’ll take pleasure in from growing their complete addressable market, Himanshu Kohli, co-founder of an Indian multi-family workplace and personal wealth supervisor at Client Associates, instructed me.
Cryptocurrency can also be discovering a spot in portfolios, albeit at a small proportion of round 2%, as traders are betting on the bitcoin rally as a hedge in opposition to macroeconomic uncertainties, stated Sengupta.
India’s rich are additionally in search of alternatives outdoors the nation.
“Ten years ago, wealthy Indians invested almost entirely at home. Today, it’s India plus the world. India remains the growth engine, with capital flowing into companies, startups, and pre-IPO opportunities — but now, global investments in equities, private markets, and overseas property are built in early, not just at retirement,” Sengupta famous.