Indian real estate booms with rising NRI interest amid Budget reforms & infrastructure growth

The Indian real estate sector is continually gaining tremendous interest from non-residential Indians (NRIs). The current growth trajectory in the Indian realty sphere is driven by resilient economic growth and infrastructural development, both at remote and national levels. As a result, the positive sentiment and strengthened purchasing power in the hands of the masses have acted as a catalyst in attracting overseas investors to India. Additionally, the announcements made in the Union Budget for FY2024-25 have carved a well-defined roadmap that will drive overseas investments in the Indian real estate sector.

Revision in Tax Slabs and Income Tax Act

Government announced to simplify the entire Income Tax Act and hence hopeful of simplified and other fiscal benefits for NRIs too. This will act as a primary growth booster of investments from the Non-Resident Indians as Income Tax is the basic structure on which the overall investment architecture is defined.Simplification of FDI norms
In order to boost overseas investments both from NRI individuals and institutional investors, thegovernment is looking forward to easing the norms pertaining to Foreign Direct Norms and Overseas Investments. This will encourage offshore investments in Indian real estate and ultimately, reflect positively on the economic growth of the country and drive the target of 20% NRI investments to chequered flag.

(Join our ETNRI WhatsApp channel for all the latest updates)

Any listed securities like NCD etc under the Portfolio Investment Schemes would now attract concessional tax rate of 12.5% along with lower holding period of 12.5 months is positive move.

Infrastructural Developments & Systematic Land Records
The budget has allocated ₹3.5 trillion for infrastructure development in 2024-25 while infrastructure investments are a major focus. As such, it is expected that this increased spending will result in an improvement in connectivity and consequently increase the attractiveness of real estate investments due to enhanced overall quality of living as well as accessibility in different regions. The infrastructural and connectivity growth in turn will boost the affinity of NRI investors to invest in their home country, thus banking on both financial and sentimental value.

Investment Advice for NRIs
Thorough research is important for NRIs who want to invest in Indian real estate. Knowing market trends, property values and legal requirements in a chosen location can help make informed decisions. Confirming the legality of ownership through credible legal counsel and professional advice from realtors can prevent potential conflicts later on.

Understanding tax implications is important, as NRIs must manage Indian and home country taxing commitments. In addition, they should analyse currency exchange risks about their influence on investment returns.

Investing in properties built by reputable and well-established developers can help minimize construction quality or project delays’ associated hazards. NRI investment landscape authorities within India can give invaluable ideas and assist them through difficulties concerning real estate investments.