Non-resident Indians (NRIs), especially from the Middle East, seems to be betting big on the property market in India, with the January-March 2024 quarter is estimated to have seen a whopping 42 percent spike in expat investments already in the residential real estate assets in their home country – more than double that of other quarters of the current fiscal year.
The luxury real estate sector is experiencing the maximum surge, with industry insiders revealing the rising demand for even top-end housing units commanding prices as high as $1.8 million (Rs 150 million) from expat Indians.
The growing trend of remittances to India in the wealth distribution preferences of NRIs, coupled with the increased availability of modern housing options offered by branded Indian developers, which offer a combination of a healthy lifestyle with world-class amenities, are cited as the reasons for the rising trend of NRI investments.
Gulf-based NRIs account for a large chunk of NRI remittances to India.
The surge in expat interest in India’s luxury home segment is said to be prompting some of the leading Indian real estate players such as Mumbai-based K Raheja Corp Homes to look at partnering with leading developers from the Middle East, especially Dubai – to launch projects in India.
“We are always willing to explore new opportunities,” Ramesh Ranganathan, CEO of K Raheja Corp Homes, told Arabian Business in response to a question on whether the group is considering partnerships with any of the Dubai or ME-based real estate companies to jointly launch projects in India.
He, however, added: “Nothing is currently in the works.”
Ranganathan, however, said his company has built a solid foundation of steady business from the Middle Eastern region over the last three years.
Industry insiders said parleys are currently on between some of the leading Indian and UAE developers and announcements on launch of few partnership projects could be expected in near-to-mid term basis.
Besides, few of the Dubai-based real estate companies by Indian-origin promoters are also expected to announce launch of projects in the premium and luxury segment in leading Indian cities.
Branded developers, tech enables prompt NRIs to up their games in India’s real estate sector
Industry players said the upward trajectory of growth seen in the Indian property markets over the last two years is anticipated to persist, fuelled by increasing NRI investments in the foreseeable future.
Expat investors are said to be upping their investment plans in India in view of the rising dominance of reputed developers and the construction quality.
“Though the residential sector in India, especially the luxury segment, has been seeing a steady increase in NRI investments in recent years, the surge in demand was substantial during the just finished festive season,”, Ranganathan said.
“This is indicative of a broader trend, as the wealth distribution preferences of NRIs reveal a growing trend of remittances to India,” he said.
The K Raheja Corp Homes chief executive pointed out that tech and sustainability are among the two important levers that lead customer demands today.
“Most of our responsible and informed customers are keen to understand if they are living in an eco-friendly property and want to know if there are tech enablers that enhance their living experience,” he said.
“Considerations such as property management services, safety, connectivity, and convenience are also pivotal in the [NRI] decision-making process for investments,” Ranganathan said.
New project launches lined up to cash on rising NRI demand
Several leading Indian developers are also moving to significantly expand their offerings with the launch of a slew of new projects to cash in on the surge in demand from both NRI and domestic investors.
DLF, Lodha Group, Godrej Properties and L&T Realty are said to be among the branded Indian developers which are planning new project launches, especially in the premium segment.
“We also plan to expand our real estate portfolio by 2.5 million square feet throughout the remainder of FY24 to accommodate rising demand,” Ranganathan said.
“Our goal for the rest of the year is to secure approvals and launch as many properties as possible so that we can offer options to our discerning customers,” he said.
Besides increased investment opportunities, rising rental yields, and advancements in technology streamlining the buying and selling process, reducing dependence on third-party alliances, is said to be aiding the spike in expat Indian investments in India currently.
Developers are also offering higher loyalty and referral benefits, property leasing and maintenance assistance and lease revenue sharing models to further aid NRI buying.
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