What NRIs need to know about real estate investment in India

The Indian real estate sector has remained a promising market for property investors from across the world.  Interestingly, the Non-resident Indians (NRIs) have taken a keen interest in the property market in India. Industry experts explain the reasons why the NRI investor must keep investing in Indian real estate.

Against the backdrop of the challenges faced due to the coronavirus pandemic, the Indian economy faced severe hardships. However, the pandemic is over, and the Indian economy is resurgent. “The pent-up demand has started to come to the fore, and the economy will grow leaps and bounds in the coming years. This will appreciate the property prices, and the NRI investors can expect a handsome ‘Return on Investment’ on the invested money. New segments of investment such as fractional ownership of land, co-working spaces, commercial real estate, and warehousing present an excellent opportunity for the NRI real estate investors,” said Subhash Goel, MD- Goel Ganga Developments.

Experts believe that a simplified taxation regime also encourages the NRIs to park their surplus money in India. “The NRIs also get an indexation benefit for properties held in India. For example, immovable properties held for more than 24 months is treated as long-term capital asset and obtain an indexation benefit with simplified taxation at 20%. The Income-tax Act of India also allows certain tax deductions under Sections 80C and 80TTA,” said Atul Goel, MD, Goel Ganga Group

The NRI community has a unique advantage of converting their hard-earned foreign income into lucrative investment options in India. With the rupee value at an all-time low of ₹75+ against a dollar, the investment in real estate has become more affordable and approachable. 

Suren Goel, Partner, RPS Group said that with the rupee value falling further, the purchasing power of the investors will rise manifold.

“For example, a piece of land worth ₹75 lakh would cost around 1 lakh dollars at present. However, at a rupee value of ₹65 against a dollar, the same cost would have been 1 lakh 15 thousand dollars,” he explained.