Tweet
Rupee decline boosts NRI investment in real estate sector
The record decline in the value of the Indian rupee and sluggish realty market has proved to be a double delight for overseas Indian investing in property here. Ever since the Rupee started depreciating, the Non Resident Indian (NRI) community has renewed its interest in the currency since it does business in dollars.
Since August, the Indian currency has weakened nearly 20 per cent against the US dollar. According to the real estate companies, analysts and consultants, this has triggered a substantial rise in the volume of property related enquiries from NRIs.
“After a long time now NRI investors are looking to invest in Indian real-estate, as rates offered to them were best and at par with the local investor, and now this scenario is an additional advantage to them,” said Ansal Housing and Construction, Director Kushagr Ansal.
He said that the current scenario is looking good especially in non-metro cities where there are mid segment projects, and where low cost/low value properties are appreciating faster than high end properties in current market.
Ansal added that for investors real estate is the best option as compared to other alternatives, even though infrastructure projects like developing expressways are also giving a good boost to this market.
He noted that NRIs will surely benefit in terms of value by at least 20 per cent (equivalent to the depreciation in Rupee in recent times) by investing in the sector.
The inflow of NRI money will also help real estate companies in paying off their dues/commitment against property already purchased as their revenue will simultaneously increase.
However, Ansal advised that in order to avail all these benefits, the NRI investors need to take their decision faster as he sees the prices in the real estate sector going up by 20-30 per cent in a few months time, especially in the wake of ever growing demand for infrastructure development.
Analysts, too, feel that the falling Rupee has made the real estate sector more attractive for the NRIs.
“Yes with the depreciation in Rupee value vis-a-vis the Dollar, there is direct financial advantage to the NRI community for making investments in the real estaste segment at present,” Director Risk Consultancy in KPMG, Neeraj Bansal said.
He said this is a good time for real estate developers to market existing and new projects to the NRI community and create a win-win situation on both sides by offering attractive rebates for 100 per cent down payment in new investments, and also offering schemes for higher interest benefits on early payment rebate options on existing projects that have investments from members of the NRI community.
Bansal further added that as NRI investments have been focussed more on luxury apartments, this is a good time for an overseas investor to get greater return on the money invested by him in a project, as well as taking full advantage of handsome rebates and discounts from developers offering higher inventory in ready to move or nearing completion projects.
Unitech MD Ajay Chandra also agreed that the current situation is optimistic for the real estate sector in 2012, as expectations of a moderation in interest rates and improvement in liquidity is likely to have a beneficial impact on the sector.
Thus, going by the prevailing optimistic trends in the sector, it seems that encouraging NRI investment in Indian real estate market may well lead to an impetus in the overall GDP growth in the forthcoming financial year.
The record decline in the value of the Indian rupee and sluggish realty market has proved to be a double delight for overseas Indian investing in property here. Ever since the Rupee started depreciating, the Non Resident Indian (NRI) community has renewed its interest in the currency since it does business in dollars.
Since August, the Indian currency has weakened nearly 20 per cent against the US dollar. According to the real estate companies, analysts and consultants, this has triggered a substantial rise in the volume of property related enquiries from NRIs.
“After a long time now NRI investors are looking to invest in Indian real-estate, as rates offered to them were best and at par with the local investor, and now this scenario is an additional advantage to them,” said Ansal Housing and Construction, Director Kushagr Ansal.
He said that the current scenario is looking good especially in non-metro cities where there are mid segment projects, and where low cost/low value properties are appreciating faster than high end properties in current market.
Ansal added that for investors real estate is the best option as compared to other alternatives, even though infrastructure projects like developing expressways are also giving a good boost to this market.
He noted that NRIs will surely benefit in terms of value by at least 20 per cent (equivalent to the depreciation in Rupee in recent times) by investing in the sector.
The inflow of NRI money will also help real estate companies in paying off their dues/commitment against property already purchased as their revenue will simultaneously increase.
However, Ansal advised that in order to avail all these benefits, the NRI investors need to take their decision faster as he sees the prices in the real estate sector going up by 20-30 per cent in a few months time, especially in the wake of ever growing demand for infrastructure development.
Analysts, too, feel that the falling Rupee has made the real estate sector more attractive for the NRIs.
“Yes with the depreciation in Rupee value vis-a-vis the Dollar, there is direct financial advantage to the NRI community for making investments in the real estaste segment at present,” Director Risk Consultancy in KPMG, Neeraj Bansal said.
He said this is a good time for real estate developers to market existing and new projects to the NRI community and create a win-win situation on both sides by offering attractive rebates for 100 per cent down payment in new investments, and also offering schemes for higher interest benefits on early payment rebate options on existing projects that have investments from members of the NRI community.
Bansal further added that as NRI investments have been focussed more on luxury apartments, this is a good time for an overseas investor to get greater return on the money invested by him in a project, as well as taking full advantage of handsome rebates and discounts from developers offering higher inventory in ready to move or nearing completion projects.
Unitech MD Ajay Chandra also agreed that the current situation is optimistic for the real estate sector in 2012, as expectations of a moderation in interest rates and improvement in liquidity is likely to have a beneficial impact on the sector.
Thus, going by the prevailing optimistic trends in the sector, it seems that encouraging NRI investment in Indian real estate market may well lead to an impetus in the overall GDP growth in the forthcoming financial year.
