Bengaluru real estate market top choice for returning NRIs: Survey |  Photo Credit: PTI
Among non-resident Indians looking to buy residential properties in India, IT hub Bengaluru remains the top choice followed by Pune and Chennai. According to a survey by ANAROCK Property Consultants, 22% of overall respondents preferred Bengaluru while just 4% preferred Kolkata while considering home purchases.
Most respondents saw the top 7 Tier-I cities as the best options, though many are also considering smaller cities to be close to their families, it said. Chandigarh, Kochi, Surat, Ahmedabad and Lucknow were favourite among tier 2 & 3 cities.
The latest CII-ANAROCK Consumer Sentiment survey also saw a reversal from its H1 2019 findings with a higher percentage of NRIs scouting properties in India for self-use rather than for investment purposes. It said 53% of NRI respondents who will buy properties in India in the coming months will do so for end-use while 47% for investment.
In the pre-COVID-19 survey in H1 2019, the end-use to investment ratio was seen at 32:68 signalling more NRIs returning to India in the backdrop of pandemic-induced uncertainties and dwindling job prospects globally.
The highest demand among this segment of consumers is for luxury properties with state-of-art amenities. Half of NRI respondents prefer luxury properties priced above Rs 1.5 crore, and 32% favour premium properties priced between Rs 90 lakh – Rs 1.5 crore.
Only 11% favour mid-segment homes (priced INR 45-90 lakh), and just 7% favour affordable properties.
“There has been a very perceptible increase in Indian housing demand from NRIs at this stage of the COVID-19 pandemic. In the recent years before COVID-19, many NRIs were in wait-and-watch mode amid the various structural reforms in the economy and the real estate industry. Before the pandemic, many NRIs keen on real estate preferred commercial properties – housing was low on their wish list. In short, the fallout of COVID-19 on global economies and job prospects has once again rekindled housing demand from NRIs,” said Anuj Puri, Chairman – ANAROCK Group.
The survey also highlighted the demand for bigger homes. At least 48% NRI respondents preferred larger homes of 3BHK configurations ( over 1,500 sq. ft.) while 28% favoured 2BHK formats. A significant 24% stated a preference for 4BHKs or higher configurations.
“The demand for luxury homes had fallen over the past few years, especially after DeMo,” says Puri. “In the housing sector, affordable homes were the top pick for NRI buyers in this period. The fact that luxury housing is back on the NRI radar despite unaccounted monies no longer being a factor is notable. Currently, the top metros favoured by NRIs are Bengaluru, Pune, Chennai and Mumbai. Tier 2 and tier 3 cities are also gaining traction, most notably Chandigarh, Kochi, Surat, Ahmedabad and Lucknow.”
In comparison to the previous survey (H2 2020), trends indicate that Chennai is seeing increasing interest by NRIs, while their preference for the other top cities remained more or less the same.
IT hub Bengaluru continues to be the hot favourite for at least 22% NRIs, followed by Pune with 18% in favour of it. Chennai drew 17% votes.”
Developer credibility is the top priority for most NRI respondents scouting for property in India. Construction delays have cast a long, persistent shadow of doubt in the minds of expatriate Indians who have spent many years abroad – and therefore out of sync with on-ground market developments. Most NRIs will only deal with branded and leading developers now. Rational pricing and reliable after-sales service – which is perceived as assured with branded players – are NRI property buyers’ second and third top priorities, the survey said.