With economies all over the world going through a depression, and the domestic economy showing prospects of bouncing back, NRIs are looking at property investments here

At a time when the US and European economies are spiraling downwards, the domestic economy in general is looking up, despite the current slowdown. Not surprisingly, the NRIs are investing in various sectors, including real estate. Several real estate projects across India have garnered approximately 10-20 percent participation from NRIs. The return on investment provided by real estate here has been found to be more attractive than that offered by developed nations. Also, the simplified process of investments has reversed the equation and many NRIs have been consistently investing in properties.

Rajesh Goenka, chairman and CEO, Axiom Estates, says, "They are the most affluent lot among real estate buyers in India, showing interest in buying large chunks of land in their home country. They are not affected by the current slowdown, as they take a long-range view of the whole scenario. They have faith in the domestic economy, and firmly believe that the prices will appreciate by at least 10 to 15 percent every year. They see the downturn as an opportunity to invest in large chunks of land or even developed areas which they get at a good discount from even the top developers."

He adds, "According to our assessment, the interest from NRIs has increased almost by 20-25 percent every quarter, which is almost two to two-anda-half times in the last two to three years. Interestingly, not just investors from the Gulf countries, but even from UK and USA have shown interest."

Raminder Grover, Managing Director, Homebay Residential, Jones Lang Lasalle Meghraj says, "Many NRIs in the US and UK are not as confident as before of sanctity of their employment, while others are disturbed by negative economic patterns across developed countries. They see greater potential for India overcoming the current economic setbacks. Sentimental attachment to their country of origin is another reason."

NRIs can expect appreciations anywhere upwards of 15 percent per annum and rental yields of 4-6 percent on property here.

There are different types of NRIs, as Akshaya Kumar, Managing Director, Parklane Property Advisors, puts it. "The Gulf NRI is one who is bound to return. NRIs are looking for decent returns, and might think of holding property here, while investors from UK and US are pure investors. NRIs mostly have an affinity to the areas they come from," he says.

Bangalore, Pune, Mumbai, Indore, Baroda, Chandigarh, Gurgaon, Kolkata and Goa seem to draw the highest number of serious inquiries. So do second home destinations and extended suburbs. Those with business aspirations are investing wherever IT/ITeS is making its presence felt. Mostly all sectors including residential, commercial, and retail have seen good NRI investments.

As opposed to earlier times when an NRI had to struggle with various rules, income tax and other issues, these days the NRI is being welcomed with open arms, and this has elicited an extraordinary response. Today, NRIs enjoy high returns, easy repatriation with no tax on sale proceeds, and easy loans. There are several realtors, financers and other organisations specialising in easy financing and mortgages for NRIs and high net worth individuals.

Courtesy: - TOI dtd: - 23rd August 2008