Investment in Indian Real Estate by NRIs has increased in the past 2-3 years. Here is why?
The years 2012 & 2013 were the watershed years in terms of growth for the country. The policy paralysis was biting and the expected growth was stalled. It was a routine to read about the squabbles in the corridors of power due to non -movement of file. The rupee was at its depreciated worst and pessimism was in the air. Developers were sitting on their projects and investors were on a wait and watch mode.
And then the NRI community came to the rescue like a knight in shining armour. A depreciating Rupee was acting as a catalyst to the Dollar and Dhiram earning NRI with additional buying power. His Rs. 1 Cr was now actually Rs. 1.3 Cr. With more money and confidence, our boy was out in the market picking his strawberries.
However, at this point the reasons for investing in India also changed. The investments now made in the country were more practical than emotional. Parameters like capital appreciation, resale value and future rental returns became common parlance.
Rather than looking at a nearing completion project or a ready project which made more lock and key sense, the investor was now thinking from an actual investor point of view.
From a contribution of 25% the NRI segment now comprises of 35% to 40% of any developers portfolio.
Fundamental points an NRI considers before buying a property are
- Developed or under developed or developing area
- Pre-launch or launch price
- Short term or long term appreciation
- Infrastructure development
- Exit options and charges
- Local development in the area
- New township planning
