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Commercial Real Estate | Investment Tips

7 Reasons Why NRI Should Invest in Indian Real Estate

7-reasons-why-nri -should-invest-in-indian-real-estate
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January 28, 2023
Market of India

Introduction

The Indian real estate sector has long been a favourite of international property investors. Having a basket of options with location advantages, Indian real estate has been a promising and booming marketplace for investors. Non-Resident Indians (NRIs) have taken a keen interest in the Indian property market despite short-term difficulties.

What has made NRI Real Estate Investment Fall Back in India?

  • A drop in the property rates
  • Enhanced transparency in government policies
  • Compliant market conditions 
  • Depreciation in the Indian rupee

Present market conditions for NRI investments in India 

1. Robust Economy

robust-economy

India has weathered the global financial crisis thanks to a high-quality, resilient, and transparent economy supported by a strong banking sector. 

As per reports, the total NRI investments are expected to reach a staggering $15 billion by the end of 2023.

2. Diversity of Investors

diversity-of-investors

With the scope of the growing digital landscape and enhancing economic growth, a wide range of investors are interested in real estate investments. Property developers are showcasing their office spaces using cutting-edge VR/AR technologies and hosting online launches to foster better client relationships.

3. Investor-Friendly Market

investor-friendly-market

NRIs are shifting their investment focus to India as the Indian Government becomes friendlier to foreign investors. The RBI and SEBI develop policies and guidelines to encourage FDI or Foreign Direct Investment.

4. NRI Real Estate Investments, a Win-Win Situation

real-estate-investments

The real estate sector has a lot to offer overseas clients, office spaces, and swanky resorts in amenities flush townships that will garner potential returns. 

5. Promising Future Trends

future-trends

Indian Government wants NRIs to buy Indian assets in foreign currencies as it will improve RBI’s foreign currency reserves and enhance the market conditions of the economy. 

7 Reasons Why NRI should Invest in Indian Real Estate

1.Depreciating Market Rupee

market-rupee

In 2022, the Indian Rupee depreciated by 3.5 per cent against the US dollar. When the rupee is at an all-time low against the dollar, it is an excellent time to remit funds back to India and make real estate investments. NRI’s can claim tax benefits while investing in Indian real estate. Commercial properties are also excellent investments in the Indian real estate market. Commercial complexes, buildings, and so on provide a good investment opportunity due to their high return on rents and leases. Furthermore, if the locations are good, rents are expected to rise yearly.

2. Government Initiatives

government-initiatives

The Government of India has taken several measures and initiatives to enhance transparency in the Indian real estate sector. 

  • GST is India’sIndia’s most significant tax reform. The benefit of GST for the real estate sector is that it will clarify tax credits and, as a result, lower property prices. It has also been ensured that there is a quick grievance redressal system.
  • RERA has also taken measures, resulting in much greater transparency, predictability, and trust, all of which are critical factors for a remote NRI buyer.

3. Better ROI for Investors

better-ROI-for-investors

With a simplified payment regime, NRI is interested in continuing to invest in the Indian real estate market. There has been a massive surge in demand for commercial property investments, increasing property prices, where NRI investors can expect a handsome ”return on investment”. Whereas real estate, particularly in the commercial sector, is a profitable investment that provides an annual rental yield of 8-10%,

4. Easier Tax System

tax-system

As India continues to be one of the leading recipients of foreign currency from abroad, a simplified taxation regime encourages NRIs to keep their excess funds in India. NRIs also benefit from indexation for properties held in India. While investing, NRIs can deposit funds in their NRO account and pay the seller from this account. When purchasing a property in India, an NRI investor may transfer funds directly to the seller’sseller’s account.

5. NRI-Friendly Investment Regulation

investor-friendly-market

The RBI has made the investment regulations NRI-friendly, with flexible market accessibility. It is no longer necessary to obtain RBI approval before purchasing a property.

6. Transparent Transaction System

transparent-transaction-system

NRI investors looking forward to Indian real estate investments can be more secure as they have become safer and are not worried about exchange rate fluctuations. The RERA was implemented in 2016 to reduce fraud and project delays associated with real estate purchases. The law now gives property buyers more power.

7. Property Price Appreciation

property-prices

Major metropolitan cities like Mumbai, Chennai, and Hyderabad have seen increased property prices. This is due to the location advantages, top-notch amenities, gyms, and proximity to public transport. It is one of the pivotal factors investors consider while investing in Indian real estate.   

Things NRI Investors Should Consider While Investing in Indian Real Estate

investing-in-indian-real-estate

  • NRIs are free to buy any type of real estate, commercial or residential, without the approval of the Reserve Bank of India.
  • NRI buyers must pay the same acquisition fees and taxes as Indian buyers, such as stamp duty, registration, annual real estate taxes, etc.
  • Any NRI is eligible for the same tax breaks as a resident Indian. Furthermore, if they decide to purchase a property worth more than Rs 50 lakh, NRIs must pay a 1% withholding TDS.

Market of India- a One-Stop Destination for NRI Investments

Market of India, India’sIndia’s largest upcoming wholesale and retail market, is well-known for its commercial properties and first-rate amenities. We have a wide range of commercial spaces with world-class infrastructure, such as retail, wholesale, and office space.

  • Nine unique markets 
  • 1,00,000+ commodities
  • 5000+ shops 

FAQs

1. Is real estate a good investment in India for NRI?
Undoubtedly, Indian real investment is a good option as it brings several flexible leasing terms, tax benefits, great returns on investment due to property value appreciation and many more factors that contribute to being a green signal for investment.
2. What are NRI account and their benefits?
A Non-Resident Indian of Indian Origin can open NRI Accounts as Non-Resident External (NRE) and Non-Resident Ordinary (NRO), allowing them to transfer funds from abroad to India more quickly and conveniently.
3. Is GST waived for NRI?
The LIC of India has announced that NRIs will be exempt from paying GST if they pay premiums from their NRE account or in foreign currency.
Market of India is India's largest upcoming wholesale and retail market in Chennai. We are known for having markets and office spaces with world-class infrastructure and ancillary services. We aim to offer traders a wide range of options for commercial spaces.

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