Large real estate developers enter holiday home mode
Major real estate developers are jumping into the vacation rental market as the pandemic has prompted wealthy people to look for second homes in the hills or by the sea, real estate consultants say.
While DLF, the country’s largest real estate developer, is planning residential developments in Goa and Kochi for 2022, several other developers are looking at locations in Himachal Pradesh and Uttarakhand.
“Real estate Developers have responded to the demand for holiday homes in these cities by creating innovative offerings with high-quality amenities. Organized players, who have an enviable track record, have an edge over other properties in these markets because of their vast experience and understanding of the laws that apply in the real world,” said Aakash Ohri, Group Executive Director and Commercial director, DLF developers at home.
Home buyers have invested in quality wilderness vacation homes in recent years as they seek social distancing, safety and comfort in one space. Hill stations have always been favorite vacation spots, especially for trips on the subway.
“While Dehradun, Kasauli and Shimla have always been popular for short breaks from Delhi NCR, towns near these hills have also boomed, e.g. New Chandigarh, Panchkula. A strategic location within a few hours drive from metropolitan cities , great views of the Shivaliks, pleasant climate and tranquility are the hallmarks of these cities,” said Ohri.
Nearly 70% of people who took part in a Savills survey said they would like to buy a second home for less than ₹2 crore and 57-70% would like to buy a second home within the next two years.
“The second housing market seems to be gradually recovering. Unlike before, when capital growth and rental income were the guiding criteria, an added dimension of a safe home away from pandemic hotspots seems to have become an important consideration,” said Shveta Jain, MD, Residential Services, Savills India. According to the survey, Goa leads in the domestic demand for second homes, with a fifth of respondents interested in buying a second home in the popular beach destination. Real estate developer Tata also has a project in Kasauli, while another listed developer, Eldeco, plans to enter the vacation home segment soon.
“We will be entering the segment with projects in Kasauli, Rishikesh and Goa. We are going to set up a joint venture and develop high-end villas. With our presence in Tier 2 cities, we are getting strong demand from our existing customer base,” said Pankaj Bajaj, President and CEO of Eldeco Group.
Uttarakhand is leading in the domestic demand for second homes in the north of the country, while Himachal Pradesh is experiencing limited demand for second homes.
“Holiday homes are on everyone’s lips these days. The closures have shown everyone the importance of peaceful rejuvenation. People want a place where they can regularly recharge their batteries to get ready for their hectic routines,” said Prateek Mittal, Managing Director of Chandigarh Group-based Sushma.