Luxury cars trump high-end homes as top choice for Next-Gen Indian HNWIs

Next-Gen Indian HNIs now favour luxury cars over high-end homes. A survey conducted for Knight Frank’s The Wealth Report 2025 has revealed that 46.5% of Next-Gen Indian high-net-worth individuals (HNWIs) aspire to own a luxury car, making it the most preferred luxury asset. High-end real estate is the second choice, with 25.7% expressing a desire to own a luxury home. Other preferred luxury investments include art collections, private jets, and superyachts.

Knight Frank’s Next Generation Survey, a first-of its-kind global study of individuals in the age group of 18 to 35 years and income of over USD 125,000, offers new insights into the priorities and preferences of the new Generation Wealth. Globally, 29.8% of the Next Gen HNWIs have cited preference for high-end real estate, followed by luxury car (27.8%) and private jet (15.1%).

Shishir Baijal, Chairman & Managing Director, Knight Frank India said, “The next generation of wealthy individuals will play a pivotal role in wealth creation and economic growth. Consequently, their aspirations will be of paramount interest to the global luxury industry. As India’s ultra-high-net-worth population continues to expand, new opportunities will emerge for global luxury brands to establish a stronger presence in the Indian market. Sectors such as superyachts, in particular, remain largely untapped and hold significant potential for growth in India.”

Knight Frank Luxury Investment Index

The Knight Frank Luxury Investment Index (KFLII), which tracks the performance of 10 popular investments of passion, reveals that handbags were the best performing luxury asset class with prices rising 2.8% in 2024. While financial markets soared in 2024, the Knight Frank Luxury Investment Index (KFLII) fell (-3.3%), reporting a negative growth for second year in a row, leaving collectors and investors to navigate a changing landscape where scarcity no longer guarantees returns.

While five out of the ten collectibles’ sectors tracked managed growth in 2024, even for the top performers the uptick was modest. The most surprising was classic cars, which saw growth of 1.2% in 2024. The low growth seen in handbag values belies some real strength in the market. As noted in the Wealth Report 2024, “the ultimate classic handbag, the Hermès Birkin in black Togo leather, is now more valuable than ever when sold on the secondary market.”

Liam Bailey, global head of research at Knight Frank, said, “Luxury collectibles have delivered for investors over the long term. If you had invested US$1 million in 2005 and tracked KFLII, your investment would now be worth US$5.4 million. The same amount invested in the S&P 500 would have been worth US$5 million by the end of 2024. Unsurprisingly, the luxury sector weathered the global financial crisis better than financial investments, and with the ability to leverage these investments through financing, the boom for collectibles lasted for well over a decade from 2008. While it took equities several years to catch up, the past decade, and the past five years in particular, has seen a consistent pattern of stronger returns from the financial sector.”

The weakest sectors were fine art, wine and whisky. Art was down 18.3%, with the market seeing a total reversal from the double-digit growth of 2023 and a worse performance than during the Covid-19 crisis when values fell 17%. The next weakest sector was fine wine, down by 9.1%, impacted by rapidly changing consumption patterns.

The fine wine market enjoyed a bull run inspired by low interest rates during Covid. As the report notes this resulted in speculative price growth, with Champagne and Burgundy in particular surging in price. The absence of Chinese buyers has also weighed on the market.

Rare whisky, a market weighed down by a rapid growth in stock returning to the secondary market after a decade of strong growth, had its second poor year with values down 9% in 2024, and is now lower by 19.3% from the market’s peak in summer 2022.