NRI investment in Indian property market seen up to 15% surges in H1 2023 over the same year period

Depreciating rupee value, coupled with the rising trend of investment-oriented purchases, are driving a major spike in non-resident Indian (NRI) investments in the Indian property market, which has seen up to 15 percent jump in the first half of 2023 over the same year-ago period. The NRI investments, especially from the Gulf region, are expected to see a further surge in the approaching festive season as developers across major NRI-preferred Indian cities are gearing up to offer attracting packages comprising price discounts, dedicated inventory, simultaneous international launches of luxury projects and special assistance for property selections for wooing expat Indian buyers. “If we are to compare the demand between 2022 and 2023 so far, then there has certainly been a growing interest from the NRIs. There is at least 10-15 percent jump in demand by the NRIs in the first six months of 2023 as compared to the

corresponding period in 2022,” Morgan Owen, Managing Director Middle East and North Africa, Anarock Group, a leading real consultancy in India and the GCC, told Arabian Business.

A senior executive at DLF, a leading Indian developer, also confirmed the rising expat Indian investments, especially from the Gulf region, in India’s residential property sector this year. “We have seen NRI investments in DLF projects [this year] going up to 15-20 percent,” Aakash Ohri, Group Executive Director and Chief Business Officer at DLF, told Arabian Business. “And we intend to more than double this figure in the coming years,” he said.

Ohri said there has been an increase in the number of NRIs looking to buy a home in India in the last two years, and the pent-up demand has begun to emerge strongly this year. Both Owen and Ohri said the residential real estate market has garnered remarkable traction from NRIs in the current year. “There are several compelling reasons behind this surge in interest, first and foremost being the growing post-Covid emotional connection NRIs having with their homeland, which often makes them inclined towards owning a residence in India,” they said.

A study by Anarock Research showed sales of about 229,000 residential units across the top 7 Indian cities in the first six months of 2023. “On average, the share of NRI purchases is anywhere between 10-15 percent of the total sales in that period,” it said. Tech cities such as Bengaluru, Hyderabad and Pune are among the top preferences for Gulf-based expat Indian investors because of the better job opportunities they offer to NRIs who plan to return to India. “Also, these cities have a very cosmopolitan nature which itself attracts many NRIs,” Owen said.

He said Delhi National Capital Region (NCR) is also one major destination that NRIs look at. “A major factor attracting NRIs here [Delhi-NCR] is the fact that after several years the region is seeing an increase in luxury supply and that too largely by branded developers,” Owen said. NRIs, of late, largely prefer to buy luxury properties in India, especially from branded and large developers.

Ohri said expat Indian buyers have recently set their sights also on emerging cities like Chandigarh, Panchkula, Goa, and Kochi, as they prefer non-metro destinations with lower density while looking for holiday homes or second homes for personal usage as well as vacation rentals. “Gurugram, in Delhi-NCR, has piqued the interest of Indians living outside India, being a bold and forward-thinking city assented as India’s newest hub for locating corporate headquarters,” said the senior executive of DLF, which has a large number of residential and commercial projects in the region.