As the rupee breached the Rs 54-mark against the US dollar, many non-resident Indians (NRIs) are aggressively looking to enter the realty sector in the country. The rupee has also lost ground against other currencies equally.
"The rupeehas depreciated 20% in past six months, so you can say it is like getting a property at 20% discount," said Parth Kikani, a fund manager with a Dubai-based financial institution, who is all set to buy a bungalow in the outskirts of Ahmedabad. "I personally feel that for investors, tier-II is a better bet for rate of return."
Major developers have been holding property exhibitions in the Gulf, Europe and the US. "We have seen tremendous interest from the Gulf and European buyers in the luxury residential real estate," said Milind Korde, managing director, Godrej Properties.
However, industry experts say the share of NRIs in the total sales is only around 5%. So NRI purchases may give cash flows to developers, but will not ease downward price pressure.
"There has been a huge rise in the number of enquiries by NRIs for investing in real estate but I do not think NRIs buying real estate would in anyway ease off pressure on developers. Secondly, developers are just marketing luxury projects to the NRIs and if they also invite investment for sub R50 lakh projects, response would be much better," said Kaustuv Roy, executive director, Cushman & Wakefield India.
But NRIs have a perception that the party may not last longer.
"This is a rare time and an opportune time to buy real estate in India. I am exploring to invest in an apartment in GK area of Delhi," said Divya Sama, who works with ministry of labour in Kabul.
High interest rate that plays party pooper for Indian buyers may not impact the NRIs as much as the rate of interest for loans in Gulf, Europe and US is much lower. "Interest rate in Dubai is 5% and that in India is 11%, but I would not like to take a forex risk for 6% as India's long-term growth remains intact and rupee could bounce back within couple of years," said Kikani.