NRI realty investment in India after COVID-19

In Indian real estate, NRI investment topic is evergreen as there are projects that are directed at them. NRIs are seen by the real estate sector, especially the ones living in the Gulf and the US, as high potential clients. Post COVID19 also NRIs will play a significant part in India’s real estate. In the last few years, commercial segment has been getting generous attention from these Indians settled abroad but post-Covid this preference will also include residential segment once again.

The size of NRI investor is huge as there are around 30 million NRIs but the real estate investment is majorly done by NRIs from USA, Saudia Arabia and UAE. The latest trend in NRI investment is the interest being shown in affordable and mid-segment housing. The inclination is mainly due to government incentives and the demand for such houses that means assured rental income. NRIs do mostly erected invest looking at the returns from the property which is why commercial became favourite. This segment gave them promise of good capital appreciation and rental yield owing to the increasing demand of Grade A offices, IT parks, and logistics centres.

After the falling rupee, the interest of NRIs is likely to get revamped and they are now interested in buying a residential property here because of their emotional connect. In fact, tier II and tier III cities are witnessing a demand for commercial offices and thus good potential investment points for NRIs. Cities like Indore, Jaipur, kochi, etc are coming up as places that are attracting investors in commercial spaces as these places promise good capital appreciation.

Post COVID-19 a ot IT/ITeS companies will be going for rationalization of manpower and they are also likely to optimize their office real estate portfolios. These firms would consolidate offices across various locations and move to smaller cities. This will also open up new avenues for investment in commercial segment. Another reason for increased NRI investment in real estate would be the fact that the investment markets such as Sensex are showing unstructured highs and lows. In all this, real estate has emerged as the safest investment option.

Real estate would also see attractive offers being extended to these high-potential clientele, and also technology will be leveraged to reach expatriate audience. Concepts like Augmented Reality (AR) and Virtual Reality (VR) will help realtors to investors across the globe in the Post Covid-19 scenario when people might stay away from site visits.

(The views expressed in this article are by Mr. Yash Miglani, MD, Migsun Group. doesn’t own any responsibility for it.)

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