With the rupee further depreciating – around seven per cent this year alone – and slower demand back home, non-resident Indians (NRIs) are lapping up property in India.
A survey conducted by Sumansa Exhibitions, organisers of the Indian Property Show, revealed that 26.7 per cent of NRIs are looking to buy property as an additional investment, which is a six per cent rise compared to last year. 89 per cent of them will invest in properties worth INR 1 crore (Dhs 700,000) and above.
“Property investments in India are believed to be the smartest move as chances of loss are negligible. If you keep a horizon of two to three years, an average return of 25-30 per cent is guaranteed,” claimed Sunil D’Costa, manager of international sales, Sahara Prime City.
The survey also reveals that Mumbai, Bengaluru and Delhi feature in the top five destinations list, suggesting that the larger Indian cities offer higher returns.
“Other than metropolitan and Tier 1 cities, momentum of investment in Tier 2 and Tier 3 cities is quite high. The rate of appreciation is higher in these places due to fast paced infrastructural developments,” added D’Costa.
The study was conducted among 16,000 NRIs across the UAE.
Sunil Jaiswal, CEO, Sumansa Exhibition said, “NRIs in the UAE mostly prefer investing in property as it is a safe option and gives good return as the capital value of any property appreciates. Plus there is always feeling of returning home since NRIs don’t get citizenship in this region, so property investment becomes a natural choice.”
Jaiswal points out that even if an NRI has to take a home loan to fund the property, payouts are cheaper compared to last year.
Despite the fact that a weaker rupee has increased investment options for NRIs, as remittances increase and bank deposits yield higher returns, industry experts say that property continues to be a preferred choice for expat Indians in terms of investment and asset creation.
“What expats look for is a good brand to invest and a price point which is good to enter. A reputed developer with a good track record, quality projects and possible price appreciation are all crucial factors,” a spokesperson from Indian developer Indiabull said.
“The trend is to invest in additional property in metro cities and enjoy the capital appreciation in four to five years time,” said Honey Katiyal, CEO, Investors Clinic, a Dubai-based Indian real estate consultancy.