Despite millions of Indians still living in grinding poverty, the economy is growing at 8%, and the ranks of the well-off and just plain loaded are ballooning. Some 80,000 Indians today have liquid assets greater than 5 Crores, up from 70,000 two years ago, American Express Co. AXP estimates, and their numbers are increasing by 13% a year. It says, in 2009 there will be 1 million individuals with 50 Lakh+ in assets, a huge sum - up from around 700,000 today.
A lot of this is new money, not legacy Indian wealth. Upcoming sectors such as software services, telecommunications, finance, and real estate are minting new millionaires every day. And the Bombay Stock Exchange has more than doubled in the past two years, handing many investors tremendous capital gains.
The first place the new moneyed class typically shows off its cash is with a big house or luxury apartment. While demand for homes over 3,000 square feet - palatial by Indian standards - was once confined to Mumbai and Delhi, more and more Indians in smaller cities want big houses, according to real estate consulting firm Cushman & Wakefield Inc. In September, Ambience Builders & Developers plunked down 540 Crores for a 60 Acres Lot in Hyderabad, with plans to turn it into high-end homes. And each of India's large cities boasts 400 to 500 houses listed at 5 Crores+, estimates real estate agency Knight Frank.
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