Delhi - a new zone for NRI investment in Realty
Large number of Indian living abroad (NRI) are willing to return to their homeland (8-9%). Real estate market in India plays a key role for NRI population to invest in their homeland. In 2012, if we go with market sources when it is observed that 40 percent of the queries related to Delhi NCR properties were from NRIs.
Along residential properties; NRI are also keen in investing into commercial property and guaranteed returns. Apart from the localities such as Gurgaon, Noida, Greater Noida, localities such as Noidaextension,Bhiwadi, Sohnaroad, Dwarka expressway, KMP expressway and Gurgaon Faridabad road offers new investment opportunities.
Since 2010, projects on Dwarka expressway had a price tag of approx. INR 2500 per sq ft. which in 2012 was appreciated to approx. 5000- 7000 per sqft for multi-story residential apartments. Due to high demand an expected appreciation this market attracts investments from NRI. Other sectors along Dwarka expressway (108,109,106,110 sectors) where the construction is expected to be over in an years and a half. The expected appreciation would be 65 to 70% in next 3 to 5 years making it a lucrative offer for NRI as well Indian investors.
Delhi real estate market offers higher rate of returns, any area that is linked to Delhi is bound to benefit from real estate appreciation compared to other metro cities. Even Faridabad and Ghaziabad are coming up as safe bets for NRI investors.
In October 2010 Allahabad high court passed an order, for complete construction STOP , whereby many developers along with investors who invested in NE were affected by the same. In Aug 2012 Allahabad high court upheld the order by clearing all the hurdles for the developers and the investors. But the two year stoppage time increased the value of the properties on Noida expressway. Where there is ample developments done by reputed developers and the appreciation of the property has been 30-35%.
Another great investment opportunity for the NRI’s was the opening on Yamuna expressway. In June 2012, rupee fell by 20% against dollars which most NRI’s saw as the best time to invest in Indian real estate. Promising returns and high appreciation of the property, made NRI’s invest in multiple units for investments purposes. More than 2800 units alone all sold to NRIs in the Indian market (Gurgaon, Noida, and greater Noida), the depreciation of rupee value of 20% gave boost of 40% to builders through NRI investments.
NRI investment beat FDI: In 2011-12, NRI remittances were USD 66.13 Billion, (3, 42, 885.05 Crores), against n FDI inflow of USD 46.8. Past three years inward remittance has been upswing. Not been effected by factors such as fragile global economy and boosted by falling rupee. US and gulf countries were the top sources of remittance in India. With Europe, place as third. RBI study finds 40% of such remittances were used for real estate investments.
02 Dec - 10:00 hrs
Founder & CEO, Right Horizons