NRIs are house-hunting again. As many as 73 percent NRIs now prefer properties priced between Rs 90 lakh to Rs 2.5 crore and IT hubs of Bengaluru (24 percent) and Pune (19 percent) are witnessing maximum demand, according to Anarock’s consumer survey.
Collectively, these two cities saw approximately 48,370 homes sold in 2020 - accounting for a 35 percent sales share among the top 7 cities.
As many as 16 percent preferred NCR market and 14 percent preferred MMR, the survey said.
“The COVID-19 pandemic has increased NRIs' emotional association of long-term security with physical assets. As many as 63 percent of the polled NRIs state this as their reason for buying homes in India now. They are also driven by the uncertainties posed by COVID-19,” said Prashant Thakur, Director & Head - Research, ANAROCK Property Consultants
Luxury properties have emerged as a hot favourite with NRIs because of the depreciating rupee value translating into greater buying power, coupled with ongoing developer discounts and offers. A majority of NRIs is buying for end-use, not as investments, he said.
According to the survey, at least 67 percent of the polled NRIs are looking for ready-to-move-in homes. If we consider the overall survey trends (including NRIs and resident Indians), just 29 percent preferred to buy RTM homes, with another 27 percent respondents preferring under-construction properties that will be delivered within a year.
Of the total 24 percent survey respondents who already booked properties in the last six months, at least 38 percent were NRIs looking to make the most of the prevailing market conditions in India, including discounts, offers and lowest-best home loan rates, the survey said.
As many as 86 percent of the polled NRIs will only consider properties by branded developers who have the highest project completion capabilities, resulting in the lowest execution risk. Another reason for this choice is NRIs' desire to buy into projects with international-grade amenities.
According to the survey, most of the polled NRIs seeking property in India are aged between 35-45 years of age. Among all NRI respondents who participated in the survey, close to 68 percent considered real estate as the best asset class for them at this time.
Regarding their outlook on residential property prices, at least 44 percent respondents felt that prices will remain stable in the short-term (i.e. 12 months), while 27 percent feel they will increase during the year. Over the long term (i.e. in 5 years), 92 percent NRI respondents think prices will increase.