Capital appreciation is the main driving factor for most high net-worth individuals and ultra-high-net-worth individuals to invest in real estate, and more than 60 per cent are planning to invest in the property market during the next two years, according to the Luxury Residential Outlook Survey 2025 conducted by India Sotheby’s International Realty (ISIR).

As many as 62% HNIs and UHNIs expressed the desire to buy luxury properties in the next 12-24 months even though the mood on economic growth turns more measured. Over 55% of HNIs prefer second or holiday homes within a four-hour drive, prioritising convenience and accessibility. Interest in international real estate among HNIs has grown from 10-11% historically to 22% in 2025, marking a notable surge, the survey showed.
Most expect real estate investments to deliver between 12% and 18% returns
HNIs and UHNIs remain primarily motivated by capital appreciation, with 55% citing it as their main reason for investing in luxury residential real estate in 2025, up from 44% in 2024. Nearly half of respondents expect real estate investments to deliver between 12% and 18%, while 38% anticipate returns below 12%. Fewer than 15% foresee returns exceeding 18%, reflecting more realistic expectations after three years of strong gains, it showed.
While financial assets like equities and commodities remain the most favoured, with 54% of respondents prioritizing them, real estate continues to attract 36% of HNIs planning to allocate surplus funds over the next two years. This underscores the value of real estate as a stable, tangible asset amidst market volatility.
With interest rates expected to ease moderately, 71% of respondents anticipate gradual reductions, although 23% remain cautious, citing inflation concerns. As India’s luxury real estate market evolves to meet the needs of affluent individuals and young wealth creators, the property landscape offers a dynamic mix of lifestyle upgrades and wealth-generation opportunities.
Confidence in India’s economic growth remains strong, albeit slightly tempered. Optimism has declined from 79% in 2024 to 71% in 2025. Nevertheless, most High-Net-Worth Individuals (HNIs) and Ultra High-Net-Worth Individuals (UHNIs) believe India will continue to be the fastest-growing major economy, with GDP growth projected to hover between 6% and 6.5%, it noted.
HNIs outlook on real estate moderates
In the real estate sector, the outlook among UHNIs and HNIs has moderated, with 62% planning to invest in the next 12–24 months compared to 71% in 2024. Despite this slight dip, the steady confidence underscores real estate’s enduring appeal as a wealth-building asset, it said.
“As we look ahead to 2025, India’s luxury real estate market is primed for continued growth, though with a more cautious optimism. We believe demand for trophy and bespoke luxury assets, especially spacious farmhouses and gated community villas in hill and beach destinations, will be a significant trend in the coming year,” said Amit Goyal, MD of India Sotheby’s International Realty.
Over the past decade, India’s billionaire count has more than doubled to 185, with their total wealth tripling. This solidifies India’s position as the third-largest base for billionaires globally, just behind the US and China, he added.
Sustained interest in second and holiday homes; 55% prefer homes within a four-hour drive
The survey also highlighted a rising interest in second and holiday homes, with 54% of respondents considering properties in hill or beach destinations. Convenience is key, as 55% prefer homes within a four-hour drive.
Dubai overtakes London as the top choice for international locations
Only 20% opt for international locations. Among global markets, Dubai has overtaken London as the top choice, with US cities also gaining attention.
“A segment once dominated by self-built bungalows has now added high-rise luxury apartments and gated community villas by renowned developers offering world-class amenities and assured quality to the demand bouquet of the rich and famous. Today, luxury real estate is more than a status symbol; it’s a robust investment avenue,” said Ashwin Chadha, CEO of India Sotheby’s International Realty.