Mumbai's luxury housing market could be heading for a correction, with 90-95% of projects in the city likely to witness a decline in prices, according to Nishant Agarwal, director of Avighna Group.
Agarwal believes the city's redevelopment boom has spiralled out of control, raising concerns about oversupply, rising density and the growing misuse of the term luxury in real estate.
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Speaking to Vishal Bhargava's YouTube channel on the Real Deal podcast, Agarwal said the definition of luxury housing has become diluted, with developers increasingly marketing projects as premium despite lacking some of the fundamental characteristics of high-end living.
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According to Agarwal, a genuine luxury residential project should meet three conditions: it should not be a redevelopment project, it should have low residential density, and its apartments should have similar configurations to ensure a comparable lifestyle among residents.
He argued that redevelopment projects combining existing occupants with new buyers often struggle to deliver the exclusivity associated with luxury housing.
He estimated that, with other factors such as location, plot size and design remaining constant, a non-redevelopment project could command a 25-30% premium over a redevelopment project.
Agarwal cited Mumbai's established luxury residential buildings as examples of projects built around low density and a relatively uniform profile of residents.
He also pointed to a growing buyer preference for standalone residential developments without a redevelopment component.
Agarwal said privacy and exclusivity are increasingly important to wealthy homebuyers. The number of residents sharing amenities, elevators and common spaces can significantly influence the experience of luxury living.
He compared residential amenities with an airport business-class lounge, arguing that even premium facilities lose their exclusivity when too many people use them.
A building with fewer apartments and more lifts, he said, offers greater convenience, shorter waiting times and more privacy.
He also identified a separate service entrance as a non-negotiable feature in luxury homes, particularly for India's ultra-rich households, where domestic staff, nurses, cooks and other support personnel are an integral part of daily life.
According to Agarwal, the absence of a separate service entrance can disrupt the functioning of a home, forcing residents, guests, delivery personnel and domestic staff to share the same access points.
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He also questioned the growing preference for international architects, arguing that foreign design expertise does not automatically translate into an understanding of how wealthy Indian families use their homes.
Agarwal traced Avighna Group's approach to luxury housing to Nishika Terraces, a residential project his family developed after failing to find a home that met its expectations.
Completed in 2002, the 18-storey building had just six apartments, along with amenities such as a gym, salon and banquet hall.
The apartments were originally sold for around Rs 8-9 crore and have since seen their estimated value rise to approximately Rs 160-170 crore, based on the last offer received by the group.
He said the building has witnessed no resale transactions since its original sale, with the original buyers continuing to own their homes.
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Agarwal also recalled how his father once declined to sell an apartment to a legendary Indian cricketer, fearing the crowds and attention that could follow the sportsperson into the building.
He believes attitudes have changed, with wealthy buyers now more accepting of celebrities as neighbours.
Agarwal said Avighna operates through a boutique development model, remains debt-free and is comfortable selling properties after receiving occupation certificates rather than relying on pre-launch sales.
He also contrasted Mumbai's relatively discreet luxury property market with Dubai, which he described as considerably more image-conscious.
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