From a wealth-creation perspective, the Covid-19 pandemic and the resultant economic impact across global economies has created opportunities in the real estate sector which make sense for an expatriate Indian to evaluate.
Indian real estate has traditionally been a favourite option for the global Indian, and in the post-Covid-19 world, it is even more so – and with good reason. The sentimental aspect is about it being ‘a home, back home’; from an investment perspective, it translates into capital value appreciation along with steady flow of rental income.
The Indian growth cogwheel is poised for high gear as the economy witnesses gradual recovery with positive GDP outlook, pent up demand and consumption in festive tailwinds, fiscal stimulus, booster dose by the government and accommodative stance of regulatory bodies to maintain low home loan interest rates, sectoral momentum on full-resumption, accelerated vaccination drive, augmented public spending on infrastructure built up.
These factors account for cumulative growth of Indian real estate as it ranks third among the 14 major sectors in terms of direct, indirect and induced effects in all sectors of the economy. Indian real estate accounts for nearly 7% of GDP growth and 15% of total employment. Hence, growth of real estate is imperative for the economy's buoyant growth.
The global currency ratio scenario also gives an added advantage to the NRI Indians.
Leasing and off-take of office spaces has risen through Q4 2020, and 2021 promises an ‘updated’ real estate. Data centres and light industrial-cum-logistics parks are also fast evolving into growth segments, and the global Indian, ideally, should also consider these options through 2021.
Investing in Indian real estate has always been an integral part of expatriate Indian investment strategy; it has further emerged as a preferred investment proposition in wake of the Covid-19 disruption.
The safe and secure aspect of buying or investing in Indian real estate – especially in the new regulatory environment – makes it an ideal proposition.
The impact of lockdowns, globally, created ‘Covid distress’ - and raised the significance of investing in Indian real estate simply on grounds of safety, security and stability amidst the globally challenged scenario.
During 2020, unsecured global job markets, reverse migration of abroad working populace and remote work trend have triggered the need to ensure that the NRI owns a safe nest back home to secure their ‘back home’ living.
Now, with the introduction of the Model Tenancy Act, Indian rental market is poised for growth and transparency which will further fuel home buying across markets to earn steady returns. There has been a need to reassess multiple investment options across Indian real estate from a dual perspective; i.e., end use as also returns on investment.
Indian developers have witnessed a surge in property enquiries across leading real estate markets, leading to higher scope of prospective sales with many favourable factors to make the purchase. The global Indians are evaluating property options in India, from their cities of origin to emerging real estate hot spot locations closer to their hometown.
With options in hand, the global Indian is in a ‘pick and choose’ situation. The current market developments include attractive property prices, wide array of properties available and flexi payment schemes and offers; these augur well for the global Indian to negotiate and close the deal.
Technological advancement in the form of a digital system of sales and marketing has empowered the non-resident Indian to make virtual site visits, understand the location and layout with augmented reality, and book via online payment gateways. The ‘ease of doing business’ scenario in India due to disruptive digital infrastructure helped to navigate the challenges of physical presence for the expatriate Indian.
For the global Indian, it is a good opportunity to invest in Indian property, amidst global uncertainties, to grab the best offers and enter the investment cycle at its rock bottom and reap appreciation benefits in the long run.
Indian real estate has adapted to the ‘new normal’, including the new trend of ‘work from home’ and ‘remote location work’ model. ‘Mission Unlock’ will enroll many new gig players in the economy, foster entrepreneurial spirit and also give a push to being a part of the multi-service industry, working out of personal boutique office spaces, in proximity to residential spaces.
‘Walk to work’ culture will power the demand for boutique office spaces in the ‘right’ growth oriented locations, plugged in by great infrastructure and connectivity. Large office spaces will also see demand as businesses relocate to peripheral satellite towns, to decongest and also consolidate, leading to better efficiency.
The regulatory environment has been instrumental in safeguarding the interests of home buyers with complete transparency and compliance mechanism, which favours domestic as well as international property buyers. The India growth story is fast moving towards becoming a $5 trillion economy, and real estate will play a significant role in making this dream a reality.
A slew of mega infrastructure projects are being completed, with support from the Indian government, this will power the success story of India like never before. For the global Indian in the GCC countries, there is a radical shift in the question of the ideal investment option, from 'Why India’ to ‘Why Not India'.
This is a million-dollar question, given that the Indian GDP outlook is poised to soon be positive given the V-shaped recovery, and this already has global institutional players betting high on growth in their Indian real estate investment portfolios. It makes perfect sense for the global Indian to also be part of the Indian real estate success story.