Amongst the various investment options available in the Indian market, real estates are the trickiest. It is not just the Indian residents but also the non-resident Indians (NRIs) who are intrigued by the real estate investment. Here are some of the reasons why NRI investment in real estate is on a high:
• Safeguarding retirement plans
• Growth of investment
• Tax benefits
• Higher returns
Unlike the Indian residents, NRIs do not have access to all kinds of properties. NRI investment in real estate is limited to residential, commercial and bungalows. However, they cannot own agricultural lands, plantation, and farmhouses, unless inherited by their ancestors.
Let us learn in detail about the investments that are viable for the NRIs:
1) Residential properties: Investing in residential projects is a wise decision as NRIs can expect high returns. NRIs can also expect substantial cash flow by renting such properties. They can acquire them directly through the builder or as part of the gated community. Residential properties mainly include apartments and flats. NRIs are advised to buy residential properties during the pre-launch phase. The location, market rates, and other factors should also be considered. They can seek expert advice if they are unsure of the nitty-gritties.
2) Commercial properties: A majority of NRIs today prefer investing in commercial real estates for two reasons: high rental yields and capital appreciation. For such investments, NRIs focus on metropolitan cities like Mumbai, Bengaluru, Delhi, Hyderabad, Chennai, and Pune. They primarily look for Grade A offices like IT parks, logistic centers, and co-working spaces. The strong start-up culture has risen the demand of co-working spaces as they cannot afford the high-quality professional property. Hence, NRIs have veered towards commercial properties in the last year or so.
3) Row-houses or bungalows: In comparison to residential or commercial properties, villas offer higher appreciation rates. They possess a large area of land per square foot. If it is a long-term investment, then row-houses/bungalows are the ideal option. They provide decent returns over time. Also, many builders and gated communities are launching row-houses and villas that are closer to the essential amenities of the city. Today, real estate companies like T Bhimjyani, Lodha Group, Kanakia, etc. have an NRI corner, answering all the queries immediately.
For smooth investment, NRIs should hold a valid passport, PAN card and appoint a Power of Attorney in case they are not present in India. NRI investment in real estate includes step-by-step procedure of registration, possession, and execution of the sale process. So, appoint a reliable Power of Attorney.