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29 March 2024

UAE expats expect post-poll property surge in India

Published
By Parag Deulgaonkar

Non-Resident Indians (NRIs) in the UAE are looking to invest in Indian real estate market sooner, as property prices and Rupee are expected to strengthen post formation of a new government.

“Home buyers across eight of 10 cities surveyed expect real estate prices to go up over the next six months,” the Housing Sentiment Index assessed by IIM Bangalore and Magicbricks.com revealed.

Cities surveyed include Ahmedabad, Kolkata, Mumbai, Delhi, Hyderabad, Pune, Noida, Gurgaon, Bangalore and Chennai.

NRIs invested over $2 billion in Indian real estate last year, driven by a weak rupee and promotions by developers to attract them at a time when domestic demand was weak, JLL, a property advisory firm, said.

They spent at least 35 per cent more on buying homes across the country in 2013 compared with the previous year and made for almost 12 per cent of total apartment sales in the top seven cities, the consultancy added.

Rahul Singh, a chartered accountant with a  private firm in Dubai, has made up his mind to buy a house in Pune.

“Property prices have remained stable for some months now. The Rupee is now getting stronger, driven by the possibility of India getting a stable government. I have decided buying a property in the coming two months,” Singh, a chartered accountant with a  private firm, said.

Sajeesh Pillai from Kerala, who works in a PR firm, said that he also has finalised a deal and is buying a one-bedroom apartment in Kochi.

“I remitted my savings earlier this month as the Rupee was strengthening. And now I used the proceeds to make a 50 per cent down payment,” he said, adding, "The higher down payment, in fact, helped me get further discount from the developer."

Sudhir Pai, Business Head, Magicbricks.com, believes Indian real estate is bound to remain attractive in the medium term with faster growth expected in the Tier II cities.

“However, active interest will take another six to nine months, since consumers expect prices to go up only after six months, post the 2014 elections.”

Results of the Indian parliamentary election will be announced today (Friday).

Uma Sitaraman, Lead Researcher, IIMB-Century Real Estate Research Initiative, said: “While the average waiting time has dropped to a little over 8 months this quarter, the range-bound increase witnessed across cities and sectors indicate that people are waiting for the election results to make real estate decisions. Clarity will set in based the election results and well after the new government takes charge.”

Properties in the Rs2 to Rs4 million range continue to be preferred with over 30 per cent buyers in this range. Apartments are the preferred housing type with over 70 per cent choosing to buy apartments.