NRI investments to elevate India's luxury real estate by 20% by 2025

NRI real estate rise: Non-Resident Indian (NRI) investments are flocking towards India's real estate, particularly in the luxury property sector. The year 2023 witnessed an uptick in NRI investments, a trend expected to continue in 2024. According to a recent report by NoBroker, NRI residential sales escalated from 11 per cent to 15 per cent, signalling growing confidence in India's real estate market. Projections suggest this figure could soar to 20 per cent by 2025.

Global NRI interest

The surge in NRI investments has been attributed to various factors, including simplified tax regimes, indexation benefits, and transparent regulations, rendering India an attractive investment destination. Developers are experiencing heightened demand from NRI investors, particularly in luxury properties. Real estate behemoth DLF reported sales exceeding Rs 2000 crore from NRI investors in the fiscal year 2022-2023, constituting approximately 14 per cent of total sales. Key markets contributing to this surge include the GCC, USA, UK, and Singapore.

DLF's recent project, DLF Privana South, exemplifies this trend, with approximately 25 per cent of sales originating from NRI markets, notably the US-Canada, Southeast Asia, and the GCC. Moreover, buyers from diverse locations, including Africa, specifically Tanzania and Kenya, have shown interest in the project.

Aakash Ohri, Jt MD & Chief Business Officer, DLF, highlighted the favourable demand from NRIs during an investor call, attributing it to the government's outreach efforts and the Indian diaspora's growing interest in investing in Indian real estate.

“The company is witnessing very favourable demand from NRIs. The government’s outreach led by the Prime Minister has led to the Indian diaspora investing in Indian real estate more than ever. The NRI community now wants a piece of the pie of Indian real estate, he said.”

Similarly, TARC Limited, headquartered in New Delhi, has witnessed significant interest from NRIs for its offerings. According to Amar Sarin, MD & CEO, TARC Ltd, nearly 20 per cent of their contributions since October 2022 have come from the NRI sector.

"Our luxury developments resonate deeply with NRIs, reflecting their cultural heritage. Nearly 20 per cent of our contributions since October 2022 come from NRIs," he said.

Realty regulation impact

Mohit Malhotra, Founder and CEO of NeoLiv, stressed on the increasing transparency and organisation in the country's realty sector due to new regulatory frameworks, attracting more investments.

Malhotra highlighted cities like Mumbai and the National Capital Region (NCR) as potential hotspots for NRI investments, especially with the focus on improving infrastructure and creating quality residential pockets with quick access to central business districts.

As the real estate market continues to evolve, NRI investors are playing a role in shaping its trajectory. Their confidence in India's realty market reflects positively on economic resilience. Experts say, with a conducive environment and growing interest, the collaboration between NRIs and the real estate sector is poised for further growth.