Non-resident Indians (NRIs) have increasingly turned their investment focus towards the Indian real estate market. The combination of a robust economy, supportive government policies, and an emotional connection to their homeland makes this a lucrative and meaningful investment choice.
Significant Investment Uptrend
The Indian residential real estate sector witnessed substantial investments from NRIs, totalling up to $13.1 billion last year, with an expected increase of around 12% this year. Major cities like Mumbai and Gurugram have been at the forefront of attracting these investments.
Emotional and Future Planning Investment
For many NRIs, investing in Indian real estate is not just a financial decision but also an emotional one. There is a common aspiration to return to India, especially after retirement, which drives them to invest in building their homes there.
Rental Income: A Lucrative Aspect
A growing trend among NRIs is to invest in properties to rent them out. This strategy provides a steady source of income and serves as a financial cushion, especially in urban areas where the demand for rental properties is high
Advantages of Currency Exchange Rates
NRIs residing in countries with stronger currencies benefit significantly when investing in Indian real estate. The favourable exchange rates make property purchases more affordable and financially advantageous.
Appreciation in Resale Value
Properties located in prime areas, particularly those constructed by reputable builders, generally have high resale values. This appreciation is driven by India’s expanding economy and ongoing urban infrastructure development.
Quality and Infrastructure Development
The Indian real estate sector has seen notable improvements in construction quality, amenities, and infrastructure, meeting international standards and attracting NRI investments.
Economic Growth and Middle-Class Aspirations
The expanding Indian economy and the growing middle-class population have further fueled the demand for quality housing. This trend ensures that NRI investments in real estate are positioned for appreciation and long-term benefits.
Introduction of REITs
The advent of Real Estate Investment Trusts (REITs) in India has provided NRIs with an opportunity to invest in income-generating properties without engaging in direct property management. REITs offer transparency, liquidity, and regular dividends, making them an attractive investment option.
For NRIs, investing in Indian real estate is more than just a financial decision; it's a connection to their roots and a smart investment for the future. The market's resilience and the array of opportunities it presents make it a choice worth considering.
Tejas is an accomplished Chartered Accountant with a passion for finance. With a decade's worth of extensive experience in the banking and credit domain, he has a deep understanding of the financial landscape across consulting and start-ups. In his time away from work, Tejas enjoys sharing his knowledge and helping others understand the intricacies of this complex domain.
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