4 Reasons Why It Is A Great Time for NRIs to Buy Property in India

Published on: 20 August 2014

It’s been a tough few years for Indian real estate, especially in the large cities. There is a lot of over-supply in the luxury residential and commercial space. A regulatory paralysis has extended the time it takes for any project to get off the ground. Buyers seem to be holding out for a fall in prices, which strangely hasn’t come.

In such a time, why would we be recommending to NRIs to buy property in India? Especially, given that rental yields in USA (the biggest base of well-to-do NRIs) are pretty attractive. we have four very strong reasons:

  1. The good times are here: All the promises and subsequent actions by the BJP government in its short tenure point to good times ahead. The sheer size of its mandate will ensure that the BJP takes the measures required to bring India’s economy on track. The mood in the business community is one of optimism, and initial economic data also suggests so. In such a time, real estate is sure to appreciate.
  2. The long term USD-INR view: We feel that the USD is fairly valued in rupee terms at this point. With the new Government seeming to be pretty proactive, a lot of investment is expected to come into the country, mainly through the FII and FDI route. This will cause a long term appreciation in the rupee. This means, if you bought a property now when the rupee was 60 to the dollar, and sold it in a few years when the rupee is say 57 to the dollar, your return will be boosted by 5% just because of the strengthening of the rupee.
  3. Diversification: Indian real estate has a low correlation to pretty much anything that a typical NRI would invest in: 401k, US Equities, Gold, Indian Equities, US Treasury bills and the like. It’s a good way to diversify your holdings.
  4. Returns: It’s not unusual to see properties in certain parts of the country appreciate by 15-20% in a year’s time. With the right guidance, the long term returns on such properties can be substantial. Our website www.house-this.com enables NRIs to identiy properties, buy them in a hassle-free manner and also get assistance in managing the property, paying utility bills or finding a tenant.

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