The Gulf NRIs have been keenly interested in the Indian real estate market. These investors, who invest on the basis of economic benefits and sentiments, have been putting their best forward to invest in the Indian real estate market, eying higher returns on investment, diversity in their portfolio, and a second home away from home. Appreciation of the value of property, favourable foreign exchange rates, and tax benefits lure them to invest in India.
Besides these, what other aspects influence NRI investors from the Gulf to invest in the Indian real estate market?
Let us consider the following aspects :
Probability of higher returns
The Indian real estate market has, for a long time, returned profitable yields on investments. It has emerged as a sure-shot investment option for those who desire to earn profits on a long-term basis.
Favourable exchange rate
Vis-à-vis the Gulf currency, the rupee exchange has depreciated, benefiting the NRIs. As a result, their purchasing power has increased. Further, the Indian real estate market has become more accessible to them from an investment perspective. Upon returning to their native place, the yield from the investments will multiply.
Tax benefits
By increasing their investment portfolio in real estate, NRIs can claim exemptions from capital gains tax and tax on the inheritance of property.
Rental income
Making investments in rental properties adds value to passive income. It acts as a shield from inflation and promotes income generation.
Strong ties with India
NRIs owning assets in India will have more emotional ties with their mother land, India.
Second house
Owning a second house has become the latest trend among people to sustain family visits, enjoy themselves on vacation, or lead a comfortable life after retirement.
Diversity
To diversify the portfolio of the NRIs, real estate is one of the options. It reduces the losses and increases the probability of increasing revenue.
Developing market
In the developing economy of India, urbanisation generates wide-ranging investment options in various sectors of the economy. The real estate sector also provides ample investment opportunities in various fields of activity.
Government activities
The Government of India has been implementing many programmes to simplify the acquisition of property by NRIs in India, especially for Gulf-based NRIs.
The NRIs can send back to their country the entire proceeds realised through the sale of properties. Thus, they can access the funds invested easily. The government has rendered documentation for NRIs very simple. The government reduced the period of stay from 182 days to 120 days to continue their NRI status in a financial year.
Thus, congenial policies and attractive income benefits are luring NRIs to invest in the Indian real estate market.
