There is some priceless investment advice that says one should invest when the market is down and the prices are low. The real estate sector in India just like other industries is on the mend after the massive hit from COVID-19.
Some positive estimates suggest that the market will recover in a span of six to nine months, once the lockdown is fully lifted. India is one of the only two major nations which has GDP growth prospects, regardless of the pandemic, as both IMF and UN have projected that India and China have the potential to bounce back in 2021.
The industry might be reeling from the effects of the slump, but this means it is a great time for investors and non resident Indians NRIs to invest in real estate. The weak rupee, RERA guidelines and favourable pricing are several tempting factors that can sweeten the deal if one is looking to invest in real estate.
Trends show that in the past couple of years, NRI interest and demand for residential realty in India has surged. There have been many policy reforms that have boosted buyers’ confidence.
One major factor for investors right now is the depreciation of the Indian rupee by almost 10% against the dollar. Stronger dollar and weaker pricing is an irresistible offer for NRIs.
Additionally, interest rates for housing loans have fallen considerably in recent months. The State Bank of India has also announced some incredible home loan options with rates from 7.2%-7.6%.
Investors will obviously prefer to invest in ready-to-move in properties vis-a-vis projects under construction. There might be some delays for projects under development because of labour and liquidity problems. This is something to bear in mind if you are looking to invest.
To generate demand and cash flow, real estate groups and builders are expected to offer some lucrative schemes, including price cuts.
At the same time, investors are looking at deals in hope of a price correction on properties across regions. This is the right time for those with the purchasing capital to upgrade their family homes to more independent and sustainable properties with modern amenities and space.
The time is also opportune because of tricky immigration laws and news of H1-B visa denials, that have created an unpredictable situation for many NRIs.
Contrary to public perception and low expectations, real estate as an asset class will thrive, although it may look very different. Real estate is headed for a transformation with decentralization and restructuring being the main themes.
An increasing number of people realize the importance of owning their own home and this will lead to a renewed interest in residential properties. It has been seen historically that real estate investments provide a higher sense of security in times of crisis when financial assets are under pressure.
With an atmosphere of global unrest triggered by a trade-war between major countries, slowdown in the economy and escalation in geo-political tensions, the property market seems to be a safe haven against the potential risks of an uncertain future.