Why Is Investing In Real Estate Becoming More Trendy Among Bollywood Celebs?

Why Is Investing In Real Estate Becoming More Trendy Among Bollywood Celebrities?

Bollywood stars make real estate investments in order to generate large returns and amass a prestigious portfolio. In recent years, the trend has intensified, and today not only the established stars but also the up-and-coming performers consider real estate to be a wise financial choice. It is believed that a Bollywood star's success is based on the number of films they sign and the amount of money they amass. While gold has always been the main focus, Bollywood celebs are increasingly interested in investing in real estate. Actors frequently invest in real estate due to the consistent Returns on Investment (ROI) & portfolio diversification.

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Since recently, numerous new age actors have also been making headlines for their property acquisitions, like Ranveer Singh, Janhvi Kapoor, and Rajkummar Rao. Previously, only the well-known stars favoured real estate investments. Their multi-crore real estate deals are what attract greater attention. The owners of these houses stand out due to their top-tier projects and ultra-luxury amenities catered to their ultra-luxurious lifestyle and social strata. Sometimes the name of the celebrity is prefixed with the location. For instance, Shah Rukh Khan's home is frequently described as being at Mumbai's Bandra Bandstand. Mannat, the actor's enormous 2,400 square foot home, is worth more than Rs 200 crore.

Why do celebrities have real estate investments?

Actors frequently invest in real estate due to the industry volatility in Bollywood. To guarantee a consistent income in their golden years or when they want to retire, many celebrities make early real estate investments. Their wealth is increased, and their marketability is increased, via real estate. Additionally, it can be bought, sold, or financed as needed. In order to maximize their profits, many Bollywood celebs have been renting out their lavish homes for filming. For instance, Saif Ali Khan's renowned Pataudi Palace has served as a backdrop for films like Veer Zaara & Rang De Basanti. In addition, Ranbir Kapoor has leased his Bandra apartment for a staggering Rs 7.94 lakh through July 2020.

According to reports, the unit's deposit alone was Rs 25.50 lakh.

Celebrities have been drawn to business investing more than luxurious penthouses or residential homes. For instance, in January 2021 Urmila Matondkar invested Rs 3.75 crore in an office building in Mumbai's Khar neighbourhood. Since the Make in India programme was introduced by Prime Minister Narendra Modi, startups have also attracted the interest of numerous actors. For instance, Aishwarya Rai made her debut as an angel investor in the clean technology start-up Ambee.

Another advantage that celebrities gain from investing in luxury real estate is tax savings.

When a person seeks to sell a piece of property, Section 54 of the Income Tax Act exempts them from paying tax on the capital gain. This means that a Bollywood celebrity can purchase a different home that would otherwise be eligible for tax deductions if invested elsewhere using the long-term capital gains from the portfolio's real estate assets.

Celebrities have a broad appeal, and their affiliation with a niche increases its reputation and revenue. As a result, the rising trend of Bollywood celebrities investing in real estate has been good for the industry, especially in Mumbai. In August 2022, the city saw an almost 20% YoY increase in property registrations. In the city, there have been more than 8,000 property sale registrations, adding more than Rs 6.20 crore to the state's revenue.

The well-known Bollywood celebrities Akshay Kumar, Shah Rukh Khan, and Suniel Shetty are regarded as the best real estate investors in the business. These actors own multibillion dollar properties both in India and abroad. Celebrities do, however, have a staff of consultants to help them with decisions. Real estate, undoubtedly the most expensive asset for consumers, makes it particularly pertinent.

Role of realtors The network of middlemen has been reduced to a tiny circle of wealthy individuals who are acquainted with other wealthy individuals. However, there are still intermediates. One explanation is that people in positions of celebrity find it difficult to negotiate. They therefore require a person to carry out their orders. Ego control is the second explanation.

A contract can fall through when two celebrities speak poorly or vehemently. An ego conflict between a well-known celebrity and a prominent listed developer could kill a contract.

How was the trend recognised by the government?

The government has timely introduced and streamlined a number of policies to support the real estate business and promote developers. Residential sales velocity has significantly increased in important markets like Mumbai, Pune, Hyderabad, and Kolkata. Mumbai has already registered more than one lakh residences in the first half of 2022. The major factors boosting homebuyers' optimism have been a stamp duty rebate in some States, lower home loan interest rates, and a faster-than-expected economic rebound.

The residential real estate sector will continue to prosper through innovation, technology, and investments as we head towards 2022. The epidemic has really been good for residential real estate. The industry has grown tremendously during the past two years, and product, demand, and supply have all changed. In the top seven American cities, residential sales of luxury properties climbed. According to current market trends, Indian real estate seems to have a promising future and is expected to do even better in the years to come. A number of elements, including price, buyer behaviour, demographic changes, and raw material costs, will continue to have an impact on the real estate market. However, the rising trend of Bollywood celebrities investing in real estate represents a significant chance for developers to capitalize on and boost property sales and profits.

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