Why is it the ideal time for NRIs to invest in real estate in India?

Posted on: September 03, 2022
Star EstateWhy is it the ideal time for NRIs to invest in real estate in India?

At first glance, the collapse of the Rupee appears to be a sufficient inducement for NRI investors. Real estate has long been a popular investment option for NRIs. With the weakening of the currency providing greater value for their capital, they are stretching this additional spending power through property investments.

The Indian Rupee has not fared well in recent years. Factors as diverse as the COVID-19 outbreak, an uncertain global geopolitical landscape, and globally rising interest rates and high inflation have resulted in a dramatic decline in the Indian currency's valuation against the US dollar, with the exchange rate falling from INR 68.3 in July 2019 to INR 80 on July 18, 2022.

However, there is an opportunity in every crisis, as the cliché goes, and NRI investors have quickly recognised one in India's real estate market. According to research, search traffic from NRI clients intending to buy a home in India grew by 117.7% between January and June 2022 compared to the same period in 2020.

These investors are profiting from a one-of-a-kind combination of conditions, which you, as an NRI, should also be aiming to capitalise on.

At first glance, the collapse of the Rupee appears to be a sufficient inducement for NRI investors. Real estate has long been a popular investment option for NRIs. With the weakening of the currency providing greater value for their capital, they are stretching this additional spending power through property investments.

However, this does not explain the variables driving this rise in investor interest.

Other investment choices, such as equities, commodities, and gold, have been destabilised due to the Rupee's devaluation, which has been attributed to factors such as rising global interest rates and inflation. The global financial markets are still recuperating from the bear runs between March and June 2022. There have been plenty of warnings of potential bear rallies before the markets turn a corner. Commodity investments have also been dangerous owing to market volatility. There are hints that global gold prices may fall by the end of this year.

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On the other hand, despite relatively lean years during the last decade, real estate in India has developed rapidly. According to industry statistics, property prices in the nation climbed by around 70% between June 2012 and June 2017. Following the dip produced by the pandemic, a new Reuters poll predicts that this pace will continue in the coming years, with residential unit prices anticipated to rise by 7.5% in 2022 and roughly 6% in 2023 and 2024.

These figures should thrill you as an investor since adding a property in India to your portfolio provides you with a safer real asset, increases in value over time, and recoups a portion of your initial investment through monthly rent payments. It's no surprise that investors from countries with sizable migrant Indian populations, such as the United Arab Emirates, Singapore, Australia, the United Kingdom, France, and Saudi Arabia, are inquiring about buying real estate in India.

Using technology to find the ideal property for your requirements and where to search If the information presented above has piqued your interest in making a real estate investment in India, you may wish to join your fellow NRI investors in utilising cutting-edge real estate platforms to expedite the whole process, from discovery and research to final sale and paperwork. These platforms, which operate at the convergence of technology, digitalisation, and human knowledge, may assist you in researching the most relevant projects across several locations to identify the property that best suits your unique needs.

Critical information such as regional pricing trends, recent project status, developer records, RERA certification status, and so on are mapped to help you make an informed decision. Dedicated experts can also be hired to ease the hassle, time, and risk associated with exploring and buying a property. To further simplify the procedure, this removes several parties usually involved in such transactions, such as local relatives, brokers, and friends.

The next logical inquiry is regarding the best market to buy a house in as an NRI - and what sort of property to buy. NRI investors are now especially interested in key business centres like Bengaluru, Mumbai, Chennai, Delhi-NCR, and Hyderabad, as the return to physical workplaces gives a chance to achieve rapid profits through monthly rental revenue. NRI buyers are also interested in purchasing larger houses, preferring more expensive 3BHK and 4BHK flats over more cheap choices. This move is consistent with India's rising desire for larger living areas, where urban inhabitants are ready to pay a higher premium for more comfort.

Choose somewhat longer-term value appreciation over rapid gains. You may look into developments and properties in tier-2 areas like Nagpur, Pune, Ahmedabad, Kochi, and Jaipur. These markets, which are positioned to emerge as the next major urban destinations in India, feature more cheap properties than those in tier-1 cities and are expected to provide superior value for money over the next 5 to 10 years.

Buying a house in India for an NRI has never been easier - or more profitable. With other investment alternatives now experiencing substantial volatility, the fall of the Indian Rupee has created a remarkable, surprising opportunity to maximise wealth in both the short and long run with few risks. It is a chance that you should not pass up as a wise investor.