Indians living abroad, if you are looking to expand your investments, you might find some greenery in your homeland. Indian real estate investment has become a trend among Non-Resident Indians, and the greenest pasture of real estate lies in the land. This blog will discuss the reasons to invest in real estate as NRI. Scroll on!
Introduction
According to a news article by Economic Times, NRI investments in Indian real estate are expected to grow by 12% in 2022.
NRIs’ investment in Indian real estate is witnessing an upward trend, with more and more Indians living abroad showing keen interest in investing in real estate back home. The Indian real estate market is currently thriving, and thanks to the plethora of investment options and real estate types, coupled with a propelling economy, it has been the hottest choice for investors, both inland and abroad.
It is no news that land is the best real estate investment you can make as an NRI. With low initial investment to a wide range of development opportunities, the land is an extremely attractive investment avenue. In this blog, we will discuss why NRIs should invest in Indian real estate and why land is your best bet! Keep reading!
Land – An Attractive Investment Avenue
Real estate investment is a lucrative option for people looking for secure yet richly yielding investment avenues. With high appreciation value and the potential to give solid returns, real estate is the investor’s favourite choice for investment. The risks associated with real estate are relatively low compared to other investment types.
You can invest in 4 main types of real estate investment – land, residential, commercial, and industrial real estate. Of the four, land is the most preferred type of investment in India and among NRIs. The land is a plain, undeveloped parcel of land – by undeveloped, we mean no construction has taken place on the land. The land is just a plain plot put up for sale. This plain plot of land brings along with it an array of benefits –
- The land has a higher appreciation value. The demand for land is high while the supply is very limited. This makes land one of the most sought-after assets by both resident and non-resident Indians. This is one of the reasons to invest in real estate as NRI.
- Land involves no maintenance cost. Unlike other types of developed properties like residential apartments, commercial complexes, industrial spaces, and more that need constant maintenance and, therefore, involves heavy maintenance cost, land is maintenance-free, except in special cases. Being an NRI, you don’t have to worry much about monitoring and maintaining your land.
- Land comes with a great deal of flexibility – you can either choose to build a commercial building that will give you steady returns in the long run or develop it into a residential property for personal use, or even resell it as it is at the right time when the market condition is bullish.
- The land is a fast-moving asset in India. Indian cities are undergoing rapid development in the corporate, IT, and other industrial and commercial sectors, increasing the demand for real estate. Land, specifically, has a higher demand in these cities as businesses and agents will look for land to set up offices and other commercial buildings, while migrant employees will look for places to live in.
These are the overall benefits of land as a real estate investment. As an NRI, you can always buy land and repurpose it for personal use or to earn from it by developing it into a residential, commercial, or industrial property and leasing it out.
The next section will see why land is the best investment you can make as an NRI.
Why Land Is The Best Investment Choice For NRIs In Real Estate
Being an NRI, it is an extremely emotional decision to make an investment back home. That too, a real estate investment? It’s not only emotionally fulfilling for the Indian in you but also for the investor in you. There are many reasons why NRIs should invest in Indian real estate. From being a regular source of income to a more straightforward tax regime, the Indian real estate market offers everything that’s on the plate to attract investors from the NRI population.
With land being a much cheaper type of real estate investment, it is the perfect type of asset for you as an NRI to invest in. The following are a few reasons to invest in real estate as NRI –
1. The value of the rupee
The rupee, when pitched against the dollar, is a dropping currency. Lingering between Rs 75 – 79, the low value of the rupee makes investing in India all the more attractive. To break it down for you further, a property will work out to be cheaper for an NRI compared to an Indian investor eyeing the same property. This is a great reason to invest in Indian real estate as an NRI. Given this, buying land in India will work out way cheaper than other types of property as the initial investment you will spend will be much lower compared to what Indian residents have to pay.
2. Upward trend in the market’s growth
We are in 2022, 2 years after the pandemic hit us. Even though the real estate market naturally took a dip during the pandemic, it was quick to recover. The demand is back, and the market is booming. This makes it the right time for NRIs to invest in land in India. Now that the market has bounced back, land investment will not take a hit whether or not the market dips again. The supply of land is low compared to its demand. Therefore, moving forward, no matter the market condition, the land real estate market will not take the hit. This is one of the reasons why NRIs should invest in Indian real estate.
3. Investor-friendly policies
The Indian government has become friendlier in dealing with foreign investors, and Foreign Direct Investment (FDIs) are being encouraged, thanks to the Reserve Bank of India and the Securities and Exchange Board of India (SEBI)’s policies and guidelines that are making more space for FDIs to thrive. This has been immensely beneficial for NRIs looking to buy land back in India and has attracted more foreign investments in Indian real estate. This is also why NRIs should invest in Indian real estate.
4. Simplified taxation
This is one of the biggest reasons to invest in real estate as NRI. The Income Tax Act of India offers a range of tax benefits and deductions that encourage NRIs to invest their excess money in the country by making investments in real estate and buying land. NRIs can build and maintain an NRO – Non-Resident Operations – account in which they can manage the earnings they receive from their investments and activities in India, such as rent, pension, etc. While investing in land, an NRI can transfer money to this account and pay the one selling the land. In addition to these, NRIs also receive indexation benefits and a lot more.
These are a few reasons that make real estate investment, especially land investment in India, extremely attractive for NRIs. You can also read more about why land is the best choice of investment compared to a villa or a flat here.
Conclusion
If you are looking to purchase land in India, specifically the south, GSquare Housing is your go-to plot developer. A household name in the southern part of India, we are south India’s largest and Tamil Nadu’s No. 1 real estate developer, with a track record of successful collaborations with individual clients and big corporates and organisations in finding them the right piece of land in the right place and at the right price. For more details, get in touch with us at www.gsquarehousing.com
