NRI - REAL ESTATE IN INDIA
NRIs wanting to buy property in India are taking the real estate market seriously enough to form informal groups to back select projects. This is the latest trend observed in the Indian realty market, and nobody’s complaining.
NRIs tend to buy residential Properties In India, preferably in their native towns or cities where their relatives and friends can supervise such projects. Law firms receive 5 to 6 enquiries every week from overseas Indians who club together and float a fund to buy property in India, stay on through the lock-in period, and sell it a good profit.
Jaipur, Hyderabad, Vijaywada, Ahmedabad, Baroda and Surat have seen groups of NRIs making such investments in malls, office spaces and residential townships. These investments are generally routed through Mauritius to avail of tax benefits. It is a win-win situation for both investors and real estate developers. The former earn handsome returns, while for the latter, it’s low-cost credit. Some projects in smaller cities have yielded as much as 50% returns.
Overseas Indians are allowed to buy real estate in India without any limit on the quantity or the number of investments, subject to the guidelines of RBI/Government.
There is a huge gap in supply in almost all sectors of property in India. The IT/ITES sector will require a space of 150 million sq. ft. by 2010, while 6.7 million housing units are currently in short supply. The emerging retail industry will require vast spaces to accommodate the large hypermarkets coming up.
On a more formal scale, capital management companies are being formed overseas by Indians to work with top builders and offer consultancy services to individuals who want
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