Monday, 6 January 2014

Rupee depreciation is making Mumbai’s properties affordable for NRIs


The zooming dollar is proving good for the builders as they are potential target ever since the rupee went down 12% against the dollar.


            It seems that falling of rupee can be bad news for economy and stocks but it can be prove one way benefit as NRIs (non-resident Indians) are suddenly investing in Mumbai’s sluggish real estate market. The zooming dollar is proving good for builders as they are potential target ever since the rupee went down 12% against the dollar. Real Estate Market sources said there is an increased level of interest from Indians living abroad. Experts said a city flat costing Rs.5.5 crore ($1 million) in May will now cost around $900,000 for an NRI investor. Pankaj Kapoor of property research firm Liass Foras said NRIs have generally preferred destinations like Bangalore, Pune, Chandigarh and Kerala.


            “They are not comfortable with Mumbai because of the risk factor and because builders here do not deliver on time,” he said. Ashutosh Limaye, research head of Jones Lang LaSalle India, said Dubai’s property market recovery is largely backed by huge investments by expatriates, particularly from India. NRIs are amongst the top five investor communities in the region. “With their natural affinity towards India, and against the depreciation of the Indian rupee against the US dollar, the NRI community’s real estate investment decisions may change in favor of the Indian market if certain parameters are met,” he said. These include higher economic growth, improved infrastructure, rise in demand for commercial space and social infrastructure. “Putting these factors into perspective, the recent fall in the Indian rupee could potentially act as a trigger for the NRI community in the Middle East to switch focus towards properties back in India,” he said.

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