News: Luxury residential rental market scripts a turnaround after Covid-19 setback-09-03-2021
Luxury residential rental market scripts a turnaround after Covid-19 setback
Gurgaon: The luxury residential rental market, which has been sluggish over the past few years and suffered a further setback due to Covid and the consequent lockdown, seems to be fast staging a comeback, particularly in the NCR city of Gurgaon.
In fact, the rentals for luxury properties across India’s top seven cities showed better year-on-year growth between January 2014 and December 2020, as per the latest report by realty consultants Anarock. And in some localities, the luxury residential rental market witnessed more growth than average capital prices — for instance, it increased by 17% in these seven years in Gurgaon’s upscale Golf Course Road.
Overall, the average rentals for a house of minimum 2,000 sq ft in the key luxury hotspots of the top seven cities rose anywhere between 17% and 26% in 2020, as compared to 2014. In the same period, average capital prices in these micro-markets saw a maximum rise of 15% — though some even saw a marginal dip like in Golf Course Road localities.
In contrast, the adjoining Golf Course Extension Road saw rentals increase by 18% and capital prices by 7%, according to the report.
CEO and Founder of PropEquity, Sameer Jasuja, however, said, “Luxury housing in Gurgaon has been gaining momentum since the onset of the Covid crisis in March last year. The weighted average prices on Golf Course Road increased by nearly 8% from Rs 14,000 per sq ft in March 2020 to about Rs 15,500 per sq ft in February 2021. The rental values have also witnessed an increase of 15-20% in the same period.”
He said apartments in luxury condominiums such as The Aralias, which were leased at Rs 2 lakh per month pre-Covid, are now getting leased at about Rs 2.75 lakh a month. Similarly, at The Magnolias, the rents have revised — from Rs 3 lakh per month to Rs 3.5 lakh per month currently.
A spokesperson for DLF also said that since the onset of the pandemic, there has been a stark jump in demand for gated communities, especially luxury condominiums. “DLF Golf Links residences on Golf Course Road command some of the highest rental yields in the luxury and super-luxury segments in the country, and a record capital appreciation too.”
While there has been a rise in overall demand for rentals for properties on Golf Course Road, for super-luxury residences — The Aralias and The Magnolias — there has been an upsurge in rentals for upto 20%. Not just Golf Course Road, for some of the DLF properties in New Gurgaon area, like in Garden City and the recently launched The Ultima, there has been a substantial jump in rentals, close to 25-30%, he added.
Mohit Arora, managing director of Supertech, said, “There has already been a rise in rental income on properties in localities where development of infrastructure is being planned by the government. The property value has not increased correspondingly but there is all possibility that demand and appreciation of properties may also go up. So, it is the right time to buy for investors.”
Anuj Puri, chairman of Anarock, said, “The average monthly rentals in Gurgaon’s Golf Course Road increased to Rs 70,000 in 2020 from Rs 60,000 in 2014, while average property prices in the same period declined marginally — from Rs 13,167 per sq ft in 2014 to Rs 13,150 per sq ft in 2020. Capital appreciation during this period either remained range-bound or varied each year. Some years saw a decent yearly hike, even as high as 7%, while prices dropped by up to 5% in other years.”
