It's a sort of super sale time for NRIs, with the present scenario of Indian real estate offering brighter prospects to them in terms of investments. At the moment, the Indian economy is relatively stable when compared to other economies in the West. The current scenario, which is witnessing instability in market conditions in the UK and Europe offers an exceptional opportunity for NRIs to invest in the Hyderabad realty market. In the recent past, the rupee has weakened dramatically with the recent value recorded as Rs 52.5 (as on January 9), while as in August 2011, a dollar was equal to Rs 44.
Hyderabad has its fair share of an NRI customer base who have been eyeing real estate in the city. In the last six months, the depreciating rupee means a 20 percent discount in property prices for NRIs. The Indian real estate market is predicted by the experts, to fetch better value in the future. As compared to properties in the West, Indian real estate seems a good buy for NRIs and offers a good amount of appreciation too.
NRIs have all the reasons to invest in Hyderabad market with the best deals offered by the builders. "Adding the rupee depreciation of 15-20 pecent, with several promotional offers announced by developers, NRI investors are looking at anywhere between 20-25% discount in the property price. The housing stock in Hyderabad market offers prospective buyers a lot of variation in terms of unit size, price and amenities. This is a win-win situation for investors and builders. A large number of people from abroad are actively exploring their options to buy or invest in real estate in Hyderabad," says Piyali Dasgupta, GM, Marketing and Communications, Cushman & Wakefield, India.
Ever since the value of rupee has fallen against US dollar, builders in Hyderabad have left no stone unturned to attract the NRI buyer with offers and deals. An upsurge in the luxury housing segment is yet another reason in making Hyderabad an attractive destination for NRIs. "Even though the market is currently dominated by end users, the devaluation of rupee is expected to evince a renewed interest among NRIs interested in investing in Hyderabad. We have sold to NRIs in the last month. Deals from NRI customers is experiencing an upward trend, and is expected to go further up in the coming months," says Anand Reddy, Executive Director, PBEL. Interestingly, buying a house property in India also gives tax benefits, of course under certain conditions.
Indians form a large chunk of the highly skilled workforce living overseas. "There is a big Telugu community in the US and the Gulf. They look for property in Hyderabad, because of sentimental values. If not for investment, NRIs prefer homes for their parents or dependants. Speculation in the market is slowly dying resulting in more and more readiness to buy property," asserts Bhawarlal Jain, Executive Vice President, Andhra Pradesh Real Estate Developers' Association.
However, being away from the property, the NRI, in his best interest had better be cautious in choosing a developer. It is best that he exercises diligence in this regard. Details such as a developer's reputation, land title, project approvals etc. should be verified. He should also check with other NRIs about their experience with developers in the city. Taking professional help from lawyers and related experts would help NRIs in taking a decision. A closer look into the execution of past projects by the developer is essential. Investors shouldn't ignore the legal issues associated with the project. "Investors should be careful about amenities, physical and social infrastructure facilities and connectivity, and make an assessment of the property. Of course, first-hand inspection of the property, the neighborhood, and interaction with the existing residents would help in making an informed decision," adds Piyali.
The preference of NRIs varies from segments that include af fordable, premium and luxury housing properties that provide all facilities and amenities under one roof. They favour locations in the vicinity of business districts, airports, educational and healthcare institutions, and yet have their residence amongst serene, green and pollution-free environment. A city’s suburban areas offer locations which are available for a reasonable price to the NRIs. "NRIs are advised to ask builders for rental management service, as its imperative that their property sees instant returns and good tenants," says Anand Reddy, Executive Director, PBEL. Last but not the least, this is the right time for NRIs to invest when the dollar and other currencies are strong enabling them to reap a sizable appreciation on their investment. Meanwhile, K Raghuram, an NRI residing in the Middle East is of the opinion that the NRE rupee deposit rates itself are very high and provide a good 9-9.5% compounded and tax free for tenors up to 10 years. End users who have availed loan may well use the rupee depreciation to reduce their loans but for investors, the ability to generate returns will depend on entry prices.