India Will Soon Be Home To Many Millionaires. Developers, Are You Listening?

India may be inching closer to bag the tag of a developed nation, but the numbers on personal wealth of us Indians do not seem as impressive. As it stands today, about 92 per cent of the adult population in India has a net-worth below $10,000, says a recent report by Swiss brokerage Credit Suisse. Only 0.5 per cent of us have a net worth of over $1,00,000.

"Total wealth here has risen fourfold between 2000 and 2017, reaching $5 trillion in mid-2017. Despite this and having four times the population of the US, India's total wealth is comparable to the level for the US, 90 years ago,” says the report.

The future is going to be much brighter though, the report adds. India will see an addition of $2.1 trillion by 2022 in its wealth, an increase of 42 per cent over the current level.

"We expect this to reach $6 trillion in real terms by 2022, which is comparable with the level in the US in 1936," Swiss brokerage Credit Suisse said a report.

Here are some other interesting findings of the report.

*Currently, there are 2.45 lakh millionaires in India. By 2022, the country would have 3.7 lakh millionaires, an increase of over 50 per cent.

*Personal wealth is dominated by property and other real assets, which make up 86 per cent of estimated household assets.

*Personal debt is estimated to be $376, or nine per cent of gross assets, even when adjustments are made for under-reporting. The overall household debt in the country as a proportion of assets is lower than in most of the developed countries.

What do real estate developers learn from these findings? Sure, we will have several rich in the coming four years. But, could people in India having more wealth in future a guarantee that they will be spending it in real estate?

The answer is, yes. We have all the reason to believe so. As the report points out, up to property investment make up for up to 86 per cent household assets in our country. Indians hunger for real estate is insatiable; their love for this asset is undying. A recent report by the Reserve Bank of India also indicated the same. Even if new-age Indians look for new options to invest and channel their wealth into other assets in the times to come, the movement could not be alarming. What makes one say so?

The past four years may not have been a joy ride for the real estate sector in India. However, buyers have only turned into fence-sitters; they are waiting for the right time to come, which is already there, well, almost.

Reformatory laws are in place; interest rates are falling; rates have property have largely corrected; home-buying processes are becoming easier.

The new rich would sure go property shopping. If they do, which cities would benefit the most?

According to a PropTiger DataLabs report for the September quarter of the current financial years, India's financial capital Mumbai and the Millennium City Gurgaon have a great inventory of luxury properties. Because of an ongoing slump, luxury properties in the two cities, where rates of property are much higher when compared to other major cities of the country, remained unsold. Luxury properties contributed 33 per cent to the total inventory stock in Gurgaon during the quarter. In Mumbai, the share stood at 30 per cent. Things may change soon as Indians get wealthier and eager to buy property.