More In­di­ans in­vest­ing in realty abroad

ON TOP OF THE WORLD In Dubai, they are lead­ing among for­eign in­vestors. As prices rise back home, other pop­u­lar des­ti­na­tions in­clude US, UK, Spain, Italy and Sin­ga­pore

Hindustan Times (Chandigarh) - Estates - - FRONT PAGE - Ar­chana Rao ht­spe­cial­pro­jects@hin­dus­tan­times.com n

More In­di­ans than ever are buy­ing realestate in in­ter­na­tional mar­kets. De­sis were the big­gest buy­ers, in terms of vol­umes and val­ues, in Dubai last year, buy­ing up the equiv­a­lent of Rs 208 bil­lion worth of prop­erty across 6,263 in­vestors, ac­cord­ing to statis­tics re­leased re­cently by the Dubai Land De­part­ment (DLD).

The DLD re­port says In­di­ans ac­counted for 25% of all trans­ac­tions, and were the lead­ing for­eign in­vestors in the first half of 2017, fol­lowed by the Pak­ista­nis, Bri­tish, Chi­nese and Cana­di­ans.

“The fac­tors driv­ing such in­ter­est are not hard to iden­tify — $1 mil­lion (about Rs 6.3 crore) would get an in­vestor a mere 1,000-sq-ft flat in Mum­bai, while the same sum in Dubai will fetch you at least 50% more,” says Anuj Puri, chair­man of Anarock Prop­erty Con­sul­tants. “As prices in In­dia rise, In­dian prop­erty in­vestors in the up­per in­come brack­ets are in­creas­ingly ex­plor­ing real es­tate op­tions abroad. While Dubai is the most pre­ferred des­ti­na­tion be­cause costs are rel­a­tively low, other emerg­ing des­ti­na­tions in­clude Kuala Lumpur and Sin­ga­pore,” says Puri.

In­ter­na­tional mar­kets are at­trac­tive to dif­fer­ent grades of buy­ers at dif­fer­ent price points, adds Ramesh Nair, CEO and coun­try head for JLL In­dia.

“In­di­ans have a tra­di­tional affin­ity for real es­tate and higher in­comes and globe-trot­ting jobs have opened up the world to these buy­ers. Mostly, we see In­di­ans with fam­ily or busi­ness in­ter­ests abroad who are in­ter­est­ing in prop­erty on for­eign shores.”

In­vest­ing in real es­tate in a for­eign coun­try also helps di­ver­sify one’s fi­nan­cial port­fo­lio, and can en­sure good cap­i­tal growth and guar­an­teed reg­u­lar ren­tal in­come, if the in­vest­ment is made in the right mar­kets, Nair adds.

In Phase 1 of the Sobha Group’s new Hart­land project in Dubai, for in­stance, 25% of buy­ers are In­dian.

“There aren’t as many in­cen­tives for in­vest­ing in real-es­tate in In­dia as there are in the Emi­rates,” says PNC Menon, chair­man of Sobha Group. “In Dubai, for in­stance, In­dian in­vestors get a tax break of 8% to 10%.”

GLOBE-TROT­TING

Glob­ally, the top seven hotspots for In­di­ans look­ing to in­vest in real-es­tate out­side In­dia are cur­rently Dubai, the UK, the US, Italy and Spain in Europe, and Thai­land closer home, says JLL’s Nair.

From stu­dio apart­ments priced un­der Rs 1 crore to luxury homes priced up­wards of Rs 50 crore, Dubai has a wide range of in­vest­ment op­tions. Prox­im­ity to In­dia, its cos­mopoli­tan cul­ture sta­ble econ­omy and world- class in­fra­struc­ture makei­tatop pref­er­ence for In­dian in­vestors.

“De­spite Brexit, or per­haps be­cause of it, the UK – par­tic­u­larly Lon­don – is seen as a good bet. Prop­erty prices are soft­en­ing and the econ­omy is ex­pected to wit­ness a mod­est down­turn, mak­ing it more at­trac­tive to in­vestors in the near fu­ture,” Nair adds. It helps that In­dian de­vel­op­ers are build­ing pre- mium res­i­den­tial projects here — In­di­ans make up about 20% of the buy­ers in the two Lodha projects in Lon­don, at Lin­coln Square and Grosvenor Square.

In the US, In­di­ans bought res­i­den­tial prop­erty worth $7.8 bil­lion dur­ing the 12-month pe­riod end­ing March 2017, emerg­ing as the fifth largest in­vestors in real es­tate in the coun­try.

Backed by mort­gage fi­nance these prop­er­ties were largely ac­quired for use as pri­mary res­i­dences or for use by a child study­ing in the US. Amer­ica is pre­ferred for its mod­estly priced prop­er­ties rather than its high­end luxury homes.

“In­di­ans wish­ing to buy a prop­erty in US can avail of the con­sid­er­ably lower in­ter­est rates of lo­cal banks there,” says Puri of Anarock

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