Real estate developers woo NRIs to benefit from the Rupee’s fall against a strong dollar

The Indian Rupee has been hitting record lows consistently for the past couple of weeks, and while the domestic currency becomes weak, NRI earning in dollars have gained clout in Indian markets. Real estate sales in India are expected to be hit by a rising interest on home loans after a 50 basis points repo rate hike by the RBI, but CEOs and celebs are driving up demand for luxury homes in Mumbai. With the dollar and foreign currencies gaining strength against the Rupee, Indian developers are now wooing NRIs, who can afford high-end homes in the country.

Real estate remains an attractive investment

Real estate accounts for 13 per cent of Indian GDP, and foreign investment into the sector by NRIs is expected to reach close to $15 billion this year, which is $2 billion more than 2021. Although stamp duty waiver in Maharashtra is a factor that makes Mumbai’s real estate attractive, the city is third in terms of investments by NRIs in real estate, after Delhi and Bengaluru. The maximum city accounts for 11 per cent of real estate investments by expats living in the US, UK and the UAE.

Growing wealth in gulf means more investment for India

Although the real estate in the Dubai and Abu Dhabi is among the most sought after globally, the growing strength of the Dirham has triggered higher demand for Indian property among Indians in the gulf. A bulk of India’s ultra-rich are NRIs and thousands more high-net worth people are moving abroad this year. More than half of them own property in India, and are also eyeing second homes in the country, which has made them an attractive consumer-base for real estate firms.

According to an Economic Times report, 15 per cent of buyers in their DLF’s luxury projects are NRIs, and the firm is also sending representatives to Hong Kong and London to pitch their properties. The rise of the dollar against the Rupee also increases purchasing power of NRIs, and a recovery in the property market after covid, promises better return on investment.