Perfect time for NRIs to invest in Indian real estate

Are you an NRI and are planning to buy a property in Ahmedabad? Read this article to know why it might be the best time to buy a property in Ahemdabad. Know how you should approach the property market and how it suits you as an investment.

Purchasing a property unquestionably ranks as one of the most cherished dream of any Indian. It does not matter which part of the world you reside in; a home in India is a must. The laws of India, of late, have made this a comparatively easy job. The RBI governs such transactions and they come under the scope of the FEMA.

Can an NRI purchase property in India?

An NRI can purchase either a commercial property or a residential property in India. Additionally, there is no restriction on the number of commercial or residential properties that an NRI can purchase in India.
But, it is important to note that an NRI cannot purchase farmhouse, plantation land or agricultural land in India and cannot even obtain such property as an award.

Why NRIs prefer to invest in 1 BHK flat in Ahmedabad or 2 BHK flat in Ahmedabad?

Ahmedabad, which has been a cost-conscious property market conventionally, dominated by the mass and mid-segment housing, has unexpectedly experienced a bout of launches in the luxury segment. Also, this shift has occurred at a time, when the general market in the state is in the middle of a delay. The city is one of the favored cities for NRIs of the state, who are looking to purchase residential properties. The city has 2-3 first-class golf township projects, which are classy and certainly meet the description of luxury. But, they are still regarded as weekend or second homes. The NRIs put in plenty of money in all asset classes such as residential, as well as commercial and plotted real estate, with the sole reason of earning returns on investment.

Future potential

Ahmedabad has the prospective to come out as one of the best extravagance destinations in India, due to constant and intended infrastructure projects, connectivity to other cities, real estate developments, and growing industrialization. Several well-known developers are coming up with well-appointed projects in Ahmedabad. As a result, buyers can select from a range of projects that offer new-age luxury and facilities that are a class apart. Several structures are being built, which mingle self-sufficient housing, with facilities like the post office, an in-house multiplex, shopping mall, and a petrol pump.

Also, several renowned apartments are contending to enter the city. The admission of luxury brands in the city, suggests clearly that the attention level of NRI buyers in the metropolis has been well marked by market research.

NRI's prefer to invest in 1 BHK flat in Ahmedabad or 2 BHK flat in Ahmedabad as the city has had a steady growth in both commercial and residential projects in India and also as government rules are accommodative and clear when it comes to investments by NRI investment in real estate in India. 

Is it the correct time for NRIs to invest in real estate?

Indian real estate has enticed NRI investors because of various factors such as a reduction in prices and depreciation of Indian currency post demonetization alongside major policy reforms, which implanted transparency and greater consolidation in the sector. Around 78% of NRI respondents like real estate over other asset classes such as stocks, mutual funds, and FD among others. The value of rupee has also been experiencing a significant low against the value of the US dollar. There is no better factor than rupee drop for the NRIs to invest in Indian real estate.

Thinking about the capital appreciation and good rental yields as of now, the NRIs are more liable towards commercial properties and luxury residential section. On the other hand, affordable housing is expected to draw the interest of juvenile NRI buyers as small ticket sizes provide better returns on investment with low investment bandwidth and easy preservation. Reasons such as short of transparency in transactions, undue delays in project delivery, and the intention of the developers were the major concerns of NRIs. But, these have been addressed with the introduction of RERA already, which has turned out to be the main reason behind the increased interest and self-assurance of the NRI buyers.

Several reasons, for instance, the government's inventiveness to strengthen the infrastructure development of the country has also motivated the NRIs to think about the Indian realty market as one of their favored investment options. But, the NRIs are still concerned about whether to invest in ready-to-move-in projects or park their money in under-construction properties. Owing to major events taking places such as NBFCs liquidity crunch and changes in the Credit-Linked Subsidy Scheme, the Indian real estate sector did not observe any noteworthy increase in the number of new launches. But, the developer's recorded higher sales of inventory in 2018 as compared to the statistics of 2017.

NRIs are a noteworthy segment of investors who usually invest in properties due to their emotional connection with the country and their plans to stay here once they stop working. The rules for NRIs have now been made simpler by the Reserve Bank of India which gives them the chance and allowance to purchase immovable property in the country. The year 2019 appears to be opportunistic for the mid-income and affordable housing segments along with investment opportunities from NRI buyers at large. There has been an increase in demand for ready-to-move-in units because of RERA and GST benefits. Under-construction projects are further anticipated to experience a massive push once the GST rates are reconsidered by the Government, which is expected to happen soon.

Experts think that it is a perfect time for NRIs to invest in the real estate sector and overall investments are anticipated to cross $10 billion-dollar mark by 2020. A slide of reforms taken under by government such as GST, RERA has made procedures much more see-through, time-bound and enhanced responsibility. As the sector turns out to be more streamlined on the rear of RERA and GST, the consumer and investor opinion has been optimistic and should enhance the ecosystem in the future further. The resulting mechanism has made the market favorable enough for NRI investors to invest in the asset classes of real estate.


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