Investment by NRIs in real estate is expected to rise to USD 14.9 billion in FY22: Report

New Delhi, April 12, 2021: USD 13.3 billion has been invested from the NRI in FY 21, according to an report by brokerage firm 360 realtors.

The investment volume has climbed up by 6.4% compared to the previous fiscal despite the overall market sentiments taking a beating due to the pandemic.

Besides attractive payment plans and growing focus on the tangible asset to de-risk, correction in the value of the Indian rupee is also giving a buying boost. Based on a regression analysis, the report has further suggested that investments will rise to USD 14. 9 billion in FY22, growing by 12%.

“NRI investments also went for a tailspin as soon as the lockdown was declared. In the 1st quarter of the last fiscal, investments from the expat community fell by 35% when compared to the same quarter last year,” said Ankit Kansal, Founder & MD, 360 Realtors.

By the end of the second quarter, the investments from NRIs grew by 18% on a year-on-year basis, as per the 360 Realtors’ report. In the subsequent quarters, the ascending tendencies continued, with NRI investments jumping by 24% & 22% respectively on an annual basis.

The reduction of the stamp duty in states like Maharashtra and Karnataka also helped in fostering increased growth.

“However, soon developers introduced numerous attractive payment plans and embraced the digital medium to build resilience. The government’s fightback strategy pinned on liquidity infusion that resulted in a reduction in home loan rates further set the stage for a quick recovery. This was also a time that was marked by a lowering in the value of the Indian rupee, furthering NRI investments,” said Kansal.

The report points out that GCC continues to be the major source of NRI investments in India. Collectively, GCC accounts for around 41% of the total investments.

Investment inflow from the expat community in the USA comprises 17% of the total purchase, followed by Singapore (12%). Other major source markets include Canada, UK, Germany, Kenya, South Africa.

Another point that has emerged in the present edition of the NRI report is incremental growth in average ticket size. Earlier reports have suggested a dip in average ticket sizes.

However, this time after the pandemic most of the buyers are now opting for larger spaces, which has made the ticket sizes edge up according to the reports  published in economictimes.indiatimes.com.

In FY21, average ticket sizes from the USA have reached USD 124,000 compared to USD 111,000 in FY20. From Singapore, the average ticket sizes have inched up to USD 93,000 from USD 91,000 in FY 20. Similarly, the average ticket size of purchase from UAE-based NRIs has grown by 11.5% to reach USD 97,000.