Earning money abroad and buying house after house in India! What else is in the shopping list of NRIs?

New Delhi: Non-resident Indians (NRIs) have started showing interest in India’s real estate market again. Especially since the Covid pandemic, a large number of NRIs are buying property in various cities of India. There are many reasons for this, such as the desire for a safe home with better facilities. Some people are buying homes now so that they can settle here in their old age. At the same time, they also consider real estate as a stable option in terms of investment. Along with this, they want to be a part of India’s growth story.

1100 luxury flats sold in Gurugram within three days

A few months ago, a big builder in Gurgaon made headlines by selling 1,100 luxury apartments with a starting price of Rs 7.5 crore in just three days. Of these, 250 apartments were bought by NRIs, said a senior leader of Indiaspora, a non-profit organisation of global Indian-origin leaders.

It is not that Non-Resident Indians (PIOs) and NRIs never had an emotional attachment to India before. But in recent years after Covid, they have increased their interest in real estate in Indian cities, from Gurgaon to Bengaluru, Hyderabad to Kolkata and Mumbai to Noida.

There are several solid reasons behind this trend. Some want a better equipped, bigger and safer home for their loved ones. Some are buying now so that they can settle here in their old age. Some are buying property as an investment for themselves or their children. Real estate has proven to be a stable asset amidst the fluctuations in the global stock market.

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The trend changed after covid

More than 35 million Indians spread across the world sent a record $107 billion to India last financial year. The figure before the Covid pandemic was $83 billion. Although there is no exact figure, industry experts say a large portion of this was invested in real estate.

Amit Goyal, CEO, India Sotheby’s International Realty, said, “Post the pandemic, many top-end developers reported an increase in sales of residential units to NRIs, who now make up about 15 per cent of their new project sales. Interest in buying good quality property in India has definitely returned. Remittances to the country have increased significantly post-Covid. A large part of this investment has gone into real estate.”

Why are NRIs buying homes in India?

Amit Goyal said that many NRIs, who have owned properties for generations, are strengthening their real estate portfolio by selling their ancestral properties and investing in new projects with better amenities, safety and security. A deep emotional bond with the country and the desire to keep their loved ones safe back home have been the main reasons for this demand. Goyal said that the NRIs we interact with now see property not just as an investment but also as a tangible connection to their roots. They also see it as an opportunity to capitalise on India’s growth story and economic resilience.

Akash Ohri, Joint MD and Chief Business Officer of DLF Home Developers Ltd, also agrees with this opinion. Ohri said, ‘NRI business had completely gone away. Today, 25 per cent of my top line is NRI business. The result is that foreign currency is also coming into the country. All the boxes have been ticked. NRIs want to come back and do something in the country. They want to invest here. They are happy to do so because they believe that the system has become better and stronger.’

NRI investment is increasing rapidly

Akash Ohri said that NRIs have come back in a very active mode. I am not saying super luxury. I am saying premium and luxury. I am talking about a million dollars… half a million dollars. In Bengaluru, luxury housing is mostly sought after by tech professionals settled abroad. Praveer Srivastava, senior VP of Prestige Group, spoke about the success of a recent villa project in Bengaluru. he/she said that a significant portion of the 130 villas priced between Rs 7 crore and Rs 11 crore were sold in six months.

Tech professionals from Andhra Pradesh settled in the US are also buying properties in Hyderabad. But there has been a slowdown recently due to the current uncertainties in the tech sector. “It is mostly tech business owners or CEOs settled abroad, who have roots in Hyderabad, who are investing here. Most of them are in the US,” said the owner of a leading construction firm. he/she said the ticket size of these foreign investments ranges between Rs 3 crore and Rs 5 crore for residential units.

Why is this trend a profitable deal

Siddhartha Pansari, president, Confederation of Real Estate Associations of India, Bengal chapter, said India’s growth story is also attracting people who are in their 30s and 40s and are working abroad but are constantly looking for opportunities in India and may return.

Abhijit Das, senior director, East, Knight Frank India, said that in most large condominium projects in areas such as New Town, Rajarhat and Southern Bypass in Kolkata, about 5-10 per cent of the apartments are bought by NRIs. he/she said that some people buy to upgrade their parents’ houses. But most of them buy these houses for themselves and rent them out.

Niranjan Hiranandani, Chairman, Hiranandani Group, said that the industry has witnessed a significant increase in NRI investment and home buying activity post-Covid in our projects in Powai, Thane, Panvel and Chennai. This increase is due to favourable macroeconomic factors including rising home ownership sentiment, currency depreciation, tax benefits, fiscal incentives such as reduction in stamp duty, ease of getting home loans and stable home loan interest rates at low to mid-range.

That’s why NRI’s interest in property in India increased

Hiranandani said NRI homebuyers consider the Indian real estate market as a stable investment option amid the crisis in global realty markets. NRI homebuyers are looking to convert their investments into end-use properties within the next five years, which is a positive trend. Overall, we have seen a growth of 7-9 per cent in NRI sales, which is 22 per cent of our total sales portfolio.

On the condition of anonymity, a group of UK and Europe-based NRIs pointed out the problems they face in the homes they have bought. A London-based NRI, who recently bought two apartments in Delhi-NCR, said, “For example, in the UK, the NHS (National Health Service) has been terrible for years. If things don’t improve soon, we may have to come to India for surgeries. However, the recent deterioration in law and order is threatening to make this country unlivable and we may have to return home if things don’t improve fast.”