There is a growing fondness among Indians for overseas real estate investments. The growing presence of Indian investors in commercial and residential neighborhoods abroad has piqued the interest of stakeholders in the International Property Market.
What is making Indians invest abroad?
Several factors make acquiring an overseas property more attractive than a domestic one. The most common reason is the slow and sluggish real estate market in India. The overall high pricing in India’s metros, various government policies, poor growth potential, inferior infrastructure, and bad rental returns are some other factors.
To cite an example, for a sum of Rs. 45 lakhs, a property investor can purchase a full-furnished condominium in Malaysia or Thailand and that too at a prime location. Not only does this offer a great lifestyle but also an opportunity to earn at least 10% net rentals. On the contrary, the same amount would only fetch a 1 BHK somewhere in the outskirts of New Delhi or Mumbai.
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High Net Worth individuals are opting for property options overseas instead of buying a holiday home in the hills or near the beach in India. Getting a premier property in a tourist destination would cost the same as a 2 BHK in prime locations of Delhi and Mumbai. The slowdown in the UK and the US economies in the last few years also have made real estate prices there more affordable.
Another major factor, besides the lifestyle and rental returns, for Indians to invest overseas is their children who are studying abroad. Also owning a second home overseas is not just a good investment, but the home itself can be handed over to professionals for maintenance and rent.
Some markets overseas are more attractive to investors than others. Malaysia is one such hotspot for Indians. Another favorite is London where the current economic slowdown is making property valuations lower, as per The Entrepreneur.
Also, under the Liberalized Remittance Scheme for Indian launched by the RBI has increased the overseas remittance limit which has helped Indian investors buy properties overseas. Many foreign markets function in a more transparent manner with lesser bureaucratic red tape thereby making them more attractive to Indian investors.
Some countries offer citizenship to investors
Certain countries in the world offer Permanent Residency and citizenship benefits if you own a property there. Hence, real estate investment could be a good way for aspiring immigrants to gain easy access to residency.
Foreign realty markets demonstrate higher rental appreciation and unlike the Indian market, they have a higher capital appreciation per year. Most of the foreign markets are mature and stable and hence you would be able to enjoy capital appreciation.
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