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Posted on June 18 2012

Pune preferred choice among expats to invest in a property

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By  Editor
Updated April 03 2023

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Pune has been a preferred choice among expats to invest in a property for a while now. The appreciating value of the dollar has, however , given further push to demand from NRIs for residential properties in various cities, including Pune. As a result, with real estate becoming cheaper for NRIs, many of them are actively seeking residential property investment opportunities in tier II cities such as Pune, points out Om Ahuja, CEO - Residential Services, Jones Lang LaSalle India. "The government has been making very proactive policy changes that are clearly aimed at routing more NRI investments into the country.

"For instance, NRIs can today buy any number of commercial or residential properties in India. The rider stating that they can repatriate sale proceeds of only two units has not been much of a dampener, since a number of NRIs are seeking to come back to India eventually. Also, they have the convenience of being able to invest in India-based properties via remittance of funds through normal banking channels , or by investing through funds in NRE/FCNR/NRO accounts maintained in India."

Moreover, NRIs are as eligible for availing of home loans from NHB-approved Indian financial institutions as resident Indians are, provided they meet applicable RBI terms and conditions . NRIs can mortgage residential property in India with an Indian financial institution without any approval from RBI, though they do require RBI's approval for mortgaging India-based properties with a foreign financial institution. Finally, NRIs are free to rent out their residential property without the approval of RBI in India. Rent received can be credited to NRO/NRE accounts or remitted abroad.

The trend towards property exhibitions has also made it easier for NRIs. Rajeev Sakhuja, Business Manager, LIC Housing Finance Ltd. (Kharadi, Kalyani Nagar) points out that when LIC Housing Finance Ltd participated in the recent Times Property Showcase in Pune on May 26 and 27, there were certainly many enquiries from NRIs. "Such exhibitions are helpful to NRIs because they get to know about the properties available in the city and the home loan options; they act as a onestop shop. Considering the volatility in the market, LIC Housing Finance Ltd gives transparent service to consumers, with convenient fixed and floating interest rates, and a convenient legal documentation process," he adds; all these are features that NRIs look for.

With such a level of enablement, it is not surprising that more NRIs are now looking at Indian real estate investments . Says Rohit Gera, Joint Managing Director, Gera Developments Pvt Ltd, "There is clearly increased interest among NRIs investing in properties in Pune, but a lot of them belong to a jurisdiction where there is economic stress in that market. So, there is a mixed bag in the current scenario. Properties are available 15% cheaper and is attractive for people looking for one, but it would have been much better if the overall global mood was positive."

In a similar vein, Kruti Jain, Director , Kumar Urban Development Ltd (KUL) avers that there is definitely a marked increase in NRI investments in real estate compared to six months ago. "Depreciation of the rupee, easy home loan availability by financial institutions in India, NRI remittances and repatriation procedures have provided a boost to NRIs looking to invest in Indian real estate. Most NRIs prefer to invest in real estate than any other form of investment largely due to higher return on investments," she says.

According to Ahuja, there are certain factors NRIs should take into consideration while investing. "While choosing a city or location to invest in, it is inadvisable to succumb to a herd mentality. I am referring to the tendency of NRIs to focus only on their hometowns or cities where close relatives reside . In the current property investment scenario, it is far more astute to purchase in cities where job creation is happening. This is crucial in terms of appreciation potential."

Similarly, NRIs should keep in mind that the appreciation potential of a residential property is directly affected by availability of basic facilities like hospitals, shopping, entertainment and public transport, he points out. "These factors should be considered while making a short-list of projects," he says.

Further, he adds, it is vital to get an accurate idea of the project's progress. "This is especially true if the property is bought directly from the developer - a risky route many NRIs seem to prefer because they want to save brokerage. When no property advisor is involved, the risk of falling prey to a deceptive projection of the project's development progress multiplies manifold ," he says. Finally, NRIs should be aware that they have every right to negotiate on the final price. "In order to be in the best possible position to negotiate , the NRI should approach the negotiation table with cheque-book in hand, to prove he or she is a serious buyer and not just shopping around," Ahuja concludes.

For more news and updates, assistance with your visa needs or for a Free Assessment of your profile for Immigration or Work Visa’s just visit www.y-axis.com

Tags:

dollar

entertainment

Jones Lang LaSalle

NRI

Pune

real estate

stress

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