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NRI Realty Investment in India Post Lockdown

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<b>By Yash Miglani, MD, Migsun Group</b> A third generation entrepreneur, Yash has been associated with the company for over eight years now.

Indian realty market has always created a niche of investment avenues for driving the NRI investment. These projects focused on garnering funds from non-native section, are created with several unique infrastructure characteristics to stand out from the rest and promise higher returns. Indian developers majorly target the potential clients from US and Gulf. The past years have seen a remarkable shift of interest in NRIs from residential to commercial establishments. However, the post-lockdown scenario is likely to oscillate their interest in both the residential and commercial categories simultaneously.

The notable size of NRI investors is humungous, with a count of almost 30 million majorly from countries like US, Saudi Arabia and UAE. One of the most recent trends has been their inclination shown towards affordable and mid-segment housing. This trend is an outcome of government incentives and the spike in demand of such houses, leading to assured rental income.

The past years have seen a remarkable shift of interest in NRIs from residential to commercial establishments


The international market value of rupee, makes the foreign investors seek properties with higher long-term returns. Commercial spaces like Grade A offices, IT parks and logistics centers due to their good rental yield and capital appreciation have become their best pick.

Ever since the lockdown began, a huge chunk of industries has been brought to a standstill. As a result, the Indian rupee value has fallen. This gives the NRIs a favorable chance to invest in residential properties here, not only due to the emotional connect but also for its promising yields. Lately, Tier II and Tier III markets have started witnessing the spurt of demand in commercial office spaces, which increases investment options in manifold for NRIs. Cities like Indore, Jaipur and Kochi are emerging as the cities with new developments in infrastructure and realty, thereby holding potential for capital appreciation in future.

As the lockdown gets gradually lifted, IT/ITes companies would be adopting measures related to rationalization of manpower; they are likely to optimize their office realty portfolios for providing workplaces which are convenient and spacious. This would lead to a shift in smaller cities, opening the channels of commercial realty investment as well.
Currently, the unstructured highs and lows in investment channels like Sensex have made property to be the safest preference.

Real estate is likely to see lucrative offers being extended to the high end clientele, technology will play a really crucial role in inciting the expatriate audience. Augmented Reality and Virtual Reality would be helpful in reaching out to the investors across the globe, when site visits will be avoided as much as possible.