The Right Time For NRIs To Buy Properties: Sliding Indian Rupee
For the last few months, the Indian Real Estate business has been seeing the back door. The slow economy has turned the matter worse. The recent slide in the Indian Rupee made it touch an all time low of Rs. 68 against Dollar ($1) in the month of July. To save the weather-beaten currency, Reserve Bank of India frantically chalked out the contingency plans. This state of economic condition demands strong attention.
Well, “every cloud has a silver lining.” In this sluggish economy, a business that is going to gain a lot is Real Estate. The time is ripe enough for developers to attract NRI customers.
With rupee touching so low, it appears that properties will appear 20 to 30 percent cheaper to the NRIs. Therefore, it is the right time for NRIs to invest in the real estate market in India.
How can buyers stroll on this challenging road? How should an NRI assess the Indian market at present? In this confusing state, developers should start focusing on their strategies and help the buyers in making up their mind.
Bangalore, Hyderabad, Chennai and Pune: Pristine Real Estate Locations
In locations like Bangalore, Hyderabad, Chennai and Pune, good closures has been seen over the last few months. As job creation is the master key for these metropolitan cities,the demand in budget segments and mid-income will be vigorous. Moreover, IT/ITES sector is going to strengthen their job creation and will further boost their employees. Thus, real estate can make a good business from these aspiring buyers.
Return – Investors can expect a return of 10-20% over 6-8 years if they buy a property in Bangalore, Chennai, Pune, Gurgaon and Navi Mumbai, as for Hyderabad the return will be 20-30%.
What parameters should NRIs look through while buying their assets in India?
- Focus on the yield of their rental value instead of the capital appreciation. Rental value represents price productivity. Thus, while buying a property make sure that the property has close to 3.5% rental yield, as any yield lesser than that indicates the asset to be overvalued.
- As many investors have reached the exit gate, so NRIs can find some good property on sale. Nevertheless, there are properties located in the less popular zones which may not have developed according to the expectations, as such NRIs must avoid buying those assets.
- When you choose a developer to buy an asset you will come across some sparkling offers, which are like soft-soaps. It will hush many bubbles but won’t clean your clothes. Do not fall prey to those futuristic promises, sales pitches and so-called “premium projects”.
In this sluggish economy, NRIs must opt for secondary properties and not the launched properties. Secondary property comes with less risk as they are finished projects and are well priced. There will be no service tax which helps the NRIs to save a lot.
This slow economy will attract NRIs to some captivating offers, as property value gets affordable. However, investments have their own risk. Sumptuous deals do have their own asterisks, so NRIs must opt for a thorough research before buying a real estate property in India. NRIs can look for discounts on various charges rather than freebies.
