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How Rupee Depreciation & Recent Reforms Could be an Investment Opportunity for NRIs in Indian Real Estate - Explained!
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The global economy is volatile and uncertainty is here to stay. With inflation levels surging globally, interest rate hikes, supply chain issues, the pandemic persisting, and oil prices and the dollar index rising, you may be wondering how to keep your money safe. While the stock market is taking a hit, letting your money sit idle means letting its value erode given the record-high levels of inflation. But where do you invest? As an NRI, you have a unique advantage. The rapidly falling rupee against the dollar along with certain recent reforms mean an investment opportunity in Indian real estate. Let’s dive right into it and see how.
1. Rupee is at an all-time low
Since 2022, the rupee has depreciated by about 5.2% against the dollar. It reached a new record low of Rs 78.20 in mid-June. This is primarily because the US dollar index – a basket of six other currencies used as a measure of the value of the dollar – has been rising steadily. In face of the Russian-Ukraine situation, soaring oil prices, and dollar outflows from the Indian markets, the rupee is expected to get weaker. As an NRI, if you invest in the Indian real estate market, your global currency like the dollar, pound, and more, will translate into more square feet of realty.
2. Better regulatory environment
Over the last few years, there have been certain important reforms in Indian real estate that have made investing a lot more transparent and convenient. A series of reforms such as the Real Estate (Regulation & Development) Act, 2016 means that you can now confidently invest in your homeland. Along with a more solid regulatory environment, increased digitisation has also made the homebuying process in India more seamless.
3. Capital appreciation and rental income
Indian real estate offers strong capital appreciation, especially premium properties in Mumbai, Delhi-NCR, Pune, Bengaluru, and other tier 1 cities. Properties in hill stations and beaches and other scenic destinations too are gaining traction. This has more so increased since after the pandemic. So, in addition to being a haven for your money in the current uncertain times, Indian real estate also offers opportunities for significant capital value appreciation along with additional rental income.
Real estate developers have been seeing a growth in their sales, with some big developers seeing their revenue reach multi-year highs. The current real estate environment in the country presents a great opportunity for a strategic investment. Especially with the depreciating rupee, your purchasing power back in India only increases. As for financing options, you can apply for home loan. You can apply for an NRI home loan with Kotak, which has been designed specifically keeping your needs as an NRI in mind. With simplified documentation and a convenient loan disbursement process, Kotak’s NRI home loan enables you to have a seamless homebuying experience.
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