As India’s real estate market faces a slowdown, developers are looking for ways to boost their sales. One of the key avenues they are turning to is the growing interest from Non-Resident Indians (NRIs).
With their strong purchasing power, mainly fueled by the depreciation of the Indian rupee, NRIs are increasingly looking to invest in luxury properties in India. This growing demand from the Indian diaspora, especially in key regions like the United States, the United Kingdom, the United Arab Emirates (UAE), Singapore, and Canada, is becoming a crucial development lifeline.
As sales in the domestic market slow down, developers are organizing roadshows in these countries to attract overseas buyers, hoping to tap into the potential of the NRI market.
According to developers, NRIs are becoming an essential part of the real estate ecosystem, accounting for a significant portion of sales. This trend is confined to metropolitan cities and extends to emerging urban centers, with NRIs diversifying their investments beyond traditional hot spots like Delhi NCR and Mumbai. Source: Economic Times
The Rapid Growth of India’s Real Estate Market
India’s real estate market has witnessed remarkable growth in recent years, and projections indicate that this growth will only accelerate in the coming decades. The sector, which was valued at Rs. 12,000 crore (US$ 1.72 billion) in 2019, is expected to reach an impressive Rs. 65,000 crore (US$ 9.30 billion) by 2040. Furthermore, India’s real estate sector is forecasted to hit a staggering US$ 1 trillion in market size by 2030, up from US$ 200 billion in 2021.
Looking further into the future, India’s real estate market is projected to soar to US$ 5-7 trillion by 2047. Some experts believe the market could surpass US$ 10 trillion, making India one of the largest real estate markets globally. Source: IBEF.org
Key Drivers of Real Estate Growth
A major factor fueling this growth is the increasing demand for infrastructure across various sectors. The retail, hospitality, and commercial real estate sectors have seen substantial expansion, driven by the rapid urbanization of Indian cities and the country’s evolving economic needs.
Moreover, the real estate sector’s contribution to India’s GDP will reach 13% in 2025. This growth reflects a shift in the country’s development priorities, emphasizing modern infrastructure to support economic growth and a growing middle class. Source: Economic Times
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Factors Driving NRI Interest in Indian Real Estate
The growing interest from NRIs in the Indian real estate market can be attributed to several factors.
- Strong Purchasing Power Due to Currency Depreciation
The depreciation of the Indian rupee has made Indian real estate significantly more affordable for NRIs. With incomes often earned in stronger currencies like the US dollar or British pound, NRIs are seeing increased purchasing power, allowing them to invest in high-value properties at attractive prices. - Key Regions Contributing to NRI Demand
NRIs from countries with large, affluent Indian communities, such as the United States, United Kingdom, UAE, Canada, and Singapore, are showing strong interest in the Indian real estate market. These regions host financially capable Indian expats motivated to invest in premium properties in India. - Growing Share of NRI Buyers in Sales
NRIs accounted for 23% of DLF’s total sales in FY24, a significant rise from 14% in FY23 and just 5% in FY22. This surge highlights the increasing role of NRIs in shaping the future of India’s real estate market.
Shift Toward Luxury Properties and High-End Developments
- NRI Preference for Luxury Living
A notable trend is the growing demand for luxury properties among NRIs. For example, nearly 27% of the units sold in DLF’s Privana West project in Gurugram were purchased by NRIs. This demonstrates their strong preference for high-end living spaces. - Developers Responding to the Shift
As demand for luxury properties continues to rise, developers are focusing on offering world-class amenities and infrastructure that align with the expectations of global buyers, ensuring that Indian real estate matches the standards of international cities. Source: Economic Times
The Role of Roadshows and Overseas Engagement
To further capitalize on this NRI interest, real estate developers in India are actively reaching out to Indian communities abroad. They organize roadshows and exhibitions in key overseas markets such as the US, UK, Australia, Singapore, and Dubai.
These roadshows are designed to directly engage with potential buyers and promote India’s diverse range of real estate projects. Developers emphasize the importance of these efforts in connecting with NRIs. They mention that NRIs’ trust in India’s growth story, robust infrastructure development, and evolving lifestyle preferences make Indian real estate a compelling investment destination.
One of the highlights of these efforts is the market in Delhi NCR, which stands out as the only region among India’s top eight cities to register positive growth in home sales during the October-December period of 2024. This growth in Delhi NCR is particularly noteworthy given that, on average, housing sales in India’s major markets dipped by 26% during the same period.
NRIs Expanding Beyond Traditional Metros
Traditionally, cities like Delhi, Mumbai, and Bangalore have been the focal points for NRI real estate investments. However, there is a noticeable shift in focus as NRIs now look beyond these metropolitan areas to invest in Tier II and III cities.
According to industry experts, NRIs are increasingly expanding their portfolios to include emerging urban centers, recognizing the growth potential these cities offer. With their affordable property prices and good future prospects, these cities are becoming attractive to NRIs seeking both residential properties and investment opportunities.
One region that is growing interest is the tri-city area of Chandigarh, Mohali, and Panchkula in northern India. Known for its modern infrastructure and quality of life, this area has become a hub for NRI investments.
Similarly, areas on the outskirts of Delhi, such as Bahadurgarh and Rohtak, are also gaining traction. These locations offer more affordable property prices and the potential for higher rental yields, which make them appealing to NRIs looking for significant returns on investment.
A real estate developer like AIPL, which is undertaking a large-scale project in Ludhiana, is also seeing a surge in interest from overseas buyers. This illustrates how even more miniature cities are becoming increasingly popular among NRIs. The lower cost of living and higher rental yields make these areas good alternatives to the high-priced real estate markets in metro cities.
The Road Ahead for India’s Real Estate Market
India’s real estate sector is entering a new era of global integration, where investment from domestic buyers and NRIs will play an integral role in shaping its future. The growing confidence in India’s economy, supported by strong fundamentals, a rapidly expanding infrastructure network, and its emergence as a preferred destination for multinational corporations, is fuelling the demand for premium real estate.
This is further boosted by the increasing number of Global Capability Centers (GCCs) being set up in India, which are creating high-paying job opportunities and driving the demand for luxury housing.
The NRI segment will likely continue playing a pivotal role in this growth, with developers seeking to connect with Indian communities worldwide. As long as the global appeal of India’s real estate market remains strong and the purchasing power of NRIs continues to grow, India’s luxury property market is set to head in the right direction.
Conclusion
As India faces a slowdown in its domestic real estate market, the NRI community’s interest is becoming more important than ever. With their strong financial backing and increasing interest in luxury homes, NRIs are helping stabilize and propel India’s real estate sector forward.
Developers actively reach out to these buyers through roadshows and targeted marketing efforts in key international markets, ensuring that the NRI community remains an integral part of the Indian real estate landscape.
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FAQs
Why are realtors targeting NRIs now?
Slowing domestic sales has made realtors seek NRI investment, leveraging their higher purchasing power and interest in Indian real estate, especially with long-term market growth projections.
What benefits do NRIs find in Indian property?
NRIs find investment potential, emotional connection, and diversification in Indian real estate. Long-term growth forecasts of US$5-7 trillion by 2047 make it a good option.
How is the market expected to reach US$5-7 trillion?
Urbanization, rising incomes, and infrastructural development are key drivers. Government policies and increased foreign investment contribute to the projected growth by 2047.
What types of properties are NRIs typically interested in?
NRIs often prefer luxury apartments, villas, and commercial properties in prime locations. They seek investments with high rental yields and long-term appreciation potential.
What challenges do NRIs face when investing in India?
NRIs encounter challenges like legal complexities, documentation issues, and currency fluctuations. Reputable realtors assist in navigating these, ensuring smooth transactions and secure investments.
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I’m Archana R. Chettiar, an experienced content creator with
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