The introduction of RERA, aimed at protecting the interest of home buyers, has rekindled NRI interest in India’s property market, providing some much-needed boost to the ailing real estate sector.
According to a study by realty portals Housing and Makaan.com, NRIs are now more confident in purchasing under-construction flats thanks to Real Estate (Regulation and Development) Act or RERA, which safeguards buyers against unreliable developers.
“Project delays in the past resulted in investors shying away from under-construction projects. From being the hot favourite of the Non-resident Indians (NRI) buyer segment, under-construction properties went on to take the back seat. This trend, however, is beginning to change – thanks to the real estate law,” the report said.
Earlier, the preference ratio for ready-to-move-in and under-construction properties was 67:33, but now the ratio stands at 56:44, it added.
Meanwhile, GST on under-construction flats has also been reduced from 12 percent to 5 percent, for affordable housing, it has been reduced to 1 percent from 8 percent, while ready flats attract no GST.
Realty portals PropTiger, Housing and Makaan are part of Singapore-based Elara Technologies, which is backed by News Corp and Softbank.
A stronger dollar has renewed NRI interest in India’s property markets, the report said, adding that the leads and visits on Housing and Makaan.com have improved by 30-40 percent from last year.
NRIs from the US, the UAE, the UK, and Singapore are most interested in Indian realty, accounting for nearly 55 percent of the buyer base. The US alone accounts for 26.5 percent of the bulk of users.
While the most significant number of users is from the US, there is a phenomenal growth in the number of users from Singapore, Malaysia, Kuwait, Canada, and the UK.
Other countries from where NRI users have expressed interest in the Indian market include Hong Kong, Bahrain, and France.
“Real estate has got a fresh lease of life after major structural changes such as the real estate law, the goods & services tax and demonetisation. Investors have expressed renewed interest, as they are more confident about regulatory practices in the country now,” said Mani Rangarajan, Group Chief Operating Officer, Elara Technologies.
Among cities, Hyderabad has received the highest NRI search sessions, followed by Mumbai and Bengaluru.
Other cities where NRI buyers are actively looking for properties include Pune, Gurgaon, Noida, Ahmedabad, Ghaziabad, Vadodara, Kochi, Goa, and Faridabad.Back to latest news