In
Indian real estate, 'luxury' is by far the most-abused word by residential
project developers/ promoters.
Any
project offering basic amenities is classified as 'luxury' in marketing
materials, advertisements & pitches. We have actually seen projects wherein
1 BHKs are being offered along with 2 BHK
& 3 BHK units being touted under the luxury tag.
What
is wrong with this picture..?
In
the first place, luxury living in any context must necessarily involve generous
living spaces. Going by that alone, a one BHK can not qualify as 'luxury' by
any stretch of imagination.
Secondly,
the interpretation of luxury in the Indian context also includes an element of
exclusiveness.
In
other words, the buyer of a luxury apartment - apart from superior amenities
and facilities - also expects to live in a project which offers a certain
socio-economic standard as a neighbourhood.
Therefore,
when a project offers 1 bedroom apartments, it automatically disqualifies
itself from the 'luxury' classification.
Returns on Real Estate Investments..
Given
that developers / promoters will continue to call every project luxurious, it
is important for buyers to understand the definition, context & meaning of
luxury in Indian residential real estate.
But,
before this, let us first examine the investment dynamics of genuine luxury
houses.
Buying
a luxury apartment for self-use already involves the need for multiple checks
& validations in any case. However, when it comes to buying such a flat for
investment, the need for 360-degree due diligence is even higher.
After
all, the final objective is returns on investment. If one is considering
investing in a luxury apartment, one must understand what the hallmarks of
genuine luxury in residential real estate are:
Ø Location Very Important..
 |
| Mr. Om-Ahuja JLL-India |
This
is one of the most crucial parameters. Though central location is certainly an
important qualifier for the luxury tag in India, a project that stands at a
central city junction beset with traffic congestion does not provide a
luxurious experience.
No
matter if a project is 'normal' or / 'luxurious', it is not house if one can
not reach it or get out of it. Investors need to look at many location
parameters, such whether the project benefits from approach roads that allow
for convenient vehicular egress & ingress.
Also,
very few people buy luxury houses & then hide them from the rest of the
world. Most owners of such a house want others to see & admire their
properties, and to entertain people there.
Noise
& air pollution apart, this purpose is not achieved if the project lies in
a chronic traffic gridlock zone. Finally, the owners themselves must have ready
access to markets, schools, colleges, hospitals & their offices.
And
before we forget - the most spectacular edifice of luxurious living falls flat
on its face as an investment bet if it is located in a crime-ridden area.
The
view available to the project’s occupants is also very pertinent. A project may
be genuinely luxurious in its internal specifications & amenities. However,
if it overlooks a slum or / congestion-prone highway, a graveyard or / a
hospital, both rental & resale potential take a beating.
The
availability of a rooftop swimming pool and a Jacuzzi in every bathroom will
not make a difference - a very basic ingredient of the luxury experience is
unavailable.
Ø Floor - to - Ceiling Height..
This
is one of the most important parameter to evaluate a project's true 'luxury'
value. If the floor - to - ceiling height is less than 12 feet, the luxury feel
is severely compromised.
Moreover,
apartments with low ceilings do not lend themselves optimally for tasteful
interior decoration.
Ø Project Density..
This
means the number of people living in the project. There is no ideal thumb-rule
for this parameter, however, it is
generally understood that a one-acre project should not house more than 60
families.
Anything
more means that the project does not qualify as 'luxury'. This is because the
available amenities are shared by too many people, destroying the project's
ambience, exclusiveness, convenience & charm.
Ø Parking Area....
Again,
there is no specific yardstick by which to measure parking sufficiency. The
commonly followed norm is that the number of bedrooms in a project should equal
the number of available car parks. A 3 bedroom apartment should therefore have
three (3) parking spaces within the project.
Though
many luxury projects in the larger cities now offer puzzle-type mechanized
parking, the fact is that HNI (High Networth Indiviuals) buyers and tenants actually prefer normal or
/ stack parking.
Ø Elevators..
The
mere provision of branded elevators does not suffice in a luxury project. The
project must also have service elevators with separate entries, to ensure that
domestic help & external suppliers do not populate the elevators &
lobby being used by residents.
Investors
must also ensure that the elevators are spacious enough to accommodate a
stretcher.
Ø Security..
Inhabitants
of a luxury project do not expect to have to install ugly security grilles over
their front doors & windows. They expect to have the assurance that their
families and property are safe in all respects. A genuine luxury project has
uncompromising human security as well as electronic surveillance & safety
measures firmly in place.
As
is evident, it takes more than a mere word like 'luxury' to place a project
head & shoulders above the rest - and thereby make it a worthwhile
investment option. While one can not stop developers from misusing the luxury
tag, it is certainly possible to understand what true luxury - even in the
Indian context - really is.
About the author..
Mr.
Om Ahuja, CEO - Residential Services, Jones Lang LaSalle India
For Media Contact
Mr.
Arun Chitnis
Head
– Corporate Communications & Media Relations
Jones
Lang LaSalle India
Level
6, Amar Avinash Corporate Plaza
Bund
Garden Road, Pune 411 001.
Tel:
(020) 30930441 Fax: (020) 40196101
Mob:
+91 9657129999
Website:
www.joneslanglasalle.co.in
Blog:
www.joneslanglasalleblog.com/realestatecompass
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