After a short period of stagnancy and slowdown in the Indian real estate sector due to the COVID-19 pandemic, the sector has quickly bounced back in the path to recovery. The sales have already revived quite close to the pre-lockdown levels. One of the notable trends which have been emerging in the Indian real estate is the increasing number of NRI investors. The NRIs had always formed a major section of property buyers in India. However, this seems to have risen due to changes in buyer sentiment caused by the pandemic.
In the past, most of the NRI property buyers purchased homes in India for investment purposes. This is primarily because properties in India can generate high returns on investment. However, there has been a significant rise in the number of end-users due to the pandemic. Many of the NRIs are now purchasing residences back home in India as a security in case they have to return. Moreover, NRIs with elderly parents who reside in rented homes are also buying properties to help their parents stay safe during the pandemic.
The current scenario in the real estate market also makes it convenient for the NRIs to purchase new properties. The current home loan rates are historically low, thanks to the reduction in repo rates by the RBI. Several states are also offering discounts on stamp duty charges, making properties more affordable. With these cost reductions in effect, developers launching various special offers and banks offering loans more easily, this is a golden opportunity for NRI property buyers.
Even though real estate had been a popular investment avenue even in the past, NRIs were often hesitant to buy properties due to shady activities by the developers and brokers. However, the establishment of RERA and the introduction of various laws have improved transparency in the sector, making it much safer to purchase properties. This has boosted the reliability of real estate and helped to build trust among the NRIs.
The increase in the number of NRI investors is a great sign for the Indian economy as it helps to build up the foreign exchange pool. The real estate sector, which was cash-starved for the recent years is now finding relief in the large inflows of money.