Real Estate: Why NRI’s Have Been Investing Back Home For Over 10 Years
Non-resident Indians are always looking for ways to diversify their capital, and few things are as tempting as the Indian real estate market nowadays: Not only we’ve seen massive changes in regulations that make buying property more accessible than ever, but also the possibility of retiring back to India with a fixed income (or even a home) has made many people turn their eyes back to their homeland.
And —in case you haven’t thought about it— there are of course several ways you can benefit from this tendency.
After the Real Estate Regulation and Development Act (RERA) was passed last year, requirements to purchase non-agricultural property in India have been lowered to the minimum, making it easier for everyone with an Indian passport to invest in real estate.
This has caused a tremendous impact in India and, of course, in the NRI community: Studies calculate that, at the end of 2017, NRI’s would have made over 20% of all investments in real estate, averaging $11.5 billion just on the top-8 cities. In a market that averages a 30% yearly growth since last decade, this is something worth looking at.
But why is all this money going to India?
It seems like right now it’s the best time to invest back in India, with all the new investors flocking in. Add this up to the rupee depreciation and the new systems set up to make easier for NRI’s to invest their money in real estate (which we’ll talk about in a second), and you get quite the perfect storm.
And, of course, the real estate market is by no means a new thing. Even though now it’s easier than ever to invest in property in India, NRI’s just like you have been doing it for years and will continue to do so.
This means that, with all this new capital coming in, there’s also a lot of NRI’s looking to sell properties they invested in 2, 5, 10, or maybe 15 years ago.
Here are some numbers, so you get the idea: In 2016, NRI’s bought $9 billion worth of property. But just 3 years before, in 2013, the number was almost half of what it is now, at $6 billion. Almost a 100% increase over 4 years.
That also means a lot of properties: Just between January and March of this year, 51,715 properties were sold in the top-9 cities in India which, at the present growth rate, would mean we could close up this year close to the mark of 300,000.
Have you done the math yet? With NRI’s investments constituting 20% of the market, that means that, at the end of this year, there could be 60,000 properties newly owned by people that don’t live in India.
That’s not all: Apparently, things are going to get way better for NRI’s. Just so you have a look at the bigger picture of what’s been going on during the last decade in Indian real estate, you need to know that, while projected to be worth 180 billion USD in 2020, in 2006 the industry was only worth 16 billion. This means that not only NRI’s are buying more and more property, but that there’s also a constant of growth for the amount of property they can buy.
To add things up, we’ve established that not only is there a massive influx of NRI capital going to Indian real estate, but also there’s more availability of estate to buy than ever and easier procedures to do so. We’ve also mentioned that the times are better than ever to start investing in India.
However, just jumping to the Indian real estate market may seem extremely complicated for most people. Because India is still really far away, isn’t it? Well, we have good news for you here.
If we got everything correctly, it’s reasonably safe to assume that you’re also an NRI. And we’ve mentioned that there are new systems set up in place to make it easier to you to invest and promised to talk about it later, remember?
So, without further ado...
Enter the 21st Century.
Peer-to-peer connectivity seems to be one of the biggest trends of our time, with companies such as Uber, Lyft, Airbnb, eBay and social media platforms making connecting with people easier, either for the business of leisure.
In that spirit, we’ve created Reobee to help you connect with people close to you that want to buy or sell real estate in India without:
- Paying for memberships and commissions.
- Constantly flying back and forth to find good opportunities.
- Dealing with extreme differences in time zones.
- Going through the process of finding overseas brokers.
- Relying on third parties to make deals.
So, whether you want to buy or sell real estate in India and meet a buyer or a seller near your current location, make sure to visit us www.reobee.com.