Luxury Cars Top the List for Young Indian Wealthy, According to New Report
Recent findings from the Knight Frank Wealth Report 2025 indicate a notable shift in the investment priorities of India’s high-net-worth individuals (HNWIs). The report reveals that luxury cars are now the preferred asset for young, wealthy Indians, surpassing the traditional interest in real estate.
The survey found that 46.5% of Indian HNWIs aged 18 to 35 with incomes exceeding $125,000 prioritize owning a luxury car. Real estate came in second, with 25.7% of respondents choosing it. This contrasts with global trends where high-end real estate is the top choice for 29.8% of next-generation HNWIs, followed by luxury cars at 27.8% and private jets at 15.1%.
Shishir Baijal, Chairman & Managing Director of Knight Frank India, emphasized the significance of these changing preferences. “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,” Baijal stated. He also noted the potential this presents for global luxury brands in the Indian market, particularly sectors like superyachts, which remain relatively untapped.
India holds 3.7% of the global affluent population, ranking fourth globally behind the United States, China, and Japan. This growing affluent population is expected to create new opportunities for international luxury brands.
The Luxury Investment Landscape
The Knight Frank Luxury Investment Index (KFLII) offers additional insights into the luxury investment sector. In 2024, handbags were the top-performing luxury asset, with a 2.8% increase in value. Despite a general decrease in the market, with the KFLII dropping by 3.3%, this segment showed resilience. “The ultimate classic handbag, the Hermès Birkin in black Togo leather, is now more valuable than ever when sold on the secondary market,” the report notes. This reflects the enduring appeal and investment potential of certain luxury collectibles.
Liam Bailey, Global Head of Research at Knight Frank, also commented on the long-term performance of luxury collectibles. “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.”
However, the report also highlights challenges in certain sectors. Fine art experienced an 18.3% decline, worse than during the Covid-19 crisis, and the fine wine market fell by 9.1% due to fewer Chinese buyers. Rare whisky also faced a 9% decrease in value during 2024. These trends illustrate the complexities of the luxury investment market, where changing consumer preferences and macroeconomic factors significantly influence asset values.
