[ecis2016.org] While NRIs continue to evince interest in the Indian property market, they remain hesitant to make investments. We examine the reasons for this and what this segment of buyers actually want
While many developers are trying to woo non-resident Indians (NRIs) to invest in their projects, very few have succeeded. This can be attributed to the failure of developers to understanding what these fellow Indians living abroad want, resulting in a mismatch between the NRIs’ expectations and the builders’ offerings. Moreover, no less than 84% of the expat Indians maintain that the opaque realty market of India, scares them. Among those who have invested in Indian real estate, the satisfaction level is quite low, with only 38% of them happy with the project and the builder.
You are reading: Do NRIs distrust Indian developers?
A large share of the NRIs (72%) maintain that they are ready to invest back home, if the market adopts best practices, notwithstanding the economic outlook or the cycles of macro-economic ups and downs. With the given market dynamics not even one-third (34%), are ready to commit to an investment in the Indian property market.
“No other market could be as tempting for investment, from the rational and emotional standpoint, as one’s home country. It is the market to bet on for ROI (return on investment). However, the prevalent mindset of taking the buyers for a ride, is something that is scary. I don’t want my money to be stuck or to keep waiting endlessly in a market, where commitment either ends in foul play or in litigations,” says Shashikant Ramachandran, an NRI in Dubai.
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These are the findings of a first-of-its-kind comprehensive global online and offline survey by real estate think-tank group Track2Realty and its global alliance partners. NRIs from the US, UK, Middle East, South Africa, Canada, Australia, New Zealand, Malaysia, Singapore and Mauritius participated in the survey. They were given a mix of open-ended and close-ended questions, to assess their investment choice in the Indian property market.
[ecis2016.org] NRIs’ confidence in Indian realty remains low
NRIs’ wish list, vis-à-vis the Indian property market
NRIs’ concerns and wish-list are not very different from those of resident Indian buyers, in terms of the quality of projects or value for money. However, they are most worried about the absence of support, during the entire process, from buying to occupying. No less than two-thirds (62%) complain that the developers’ sales teams behave differently during the pre-purchase and post-purchase periods.
57% want the documentation of the developers, including the offer letter and the builder-buyer agreement, to be foolproof and clarify all details, including legalities, government policies and tax implications.
“Even if I hire a lawyer for due diligence, chances of foul play exist. A genuine builder is one who provides me with the due diligence in right earnest. I recently invested in Bengaluru with a developer whose team documented everything like a true professional agency. Best of all, my friends and family back home, say that their market reputation is exemplary,” reveals Sudha Chandran, an NRI from Boston.
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Nearly three-fourths (72%) of the NRIs demand an online option to get their apartments customised as per their needs, while 70% want to be involved in the design and construction phase. 78% assert that mere updating the construction status is not enough for them to trust the developer. Rental assurance was also important for 60% of the NRIs.
Nearly all (92%) of the NRIs are ready to pay for a reputed developer, as they feel it is better to be safe, rather than sorry. A large number of them (80%), even maintain that the property shows by Indian developers in their country of work, only matter to them as project information guides. Road shows or advertising campaigns by lesser-known developers, only tempts 28% of the NRIs and that too, if the developer also has to offer something exclusive along the way.
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The top brands in Indian real estate that NRIs trust:
- Sobha Ltd
- Godrej Properties
- Puravankara Projects
- Prestige Estates
- Oberoi Realty
- Embassy Group
- Brigade Group
- DLF
- Tata Housing
- K Raheja Corp
NRIs’ main concerns in the Indian property market
- 84% of NRIs are afraid of the opaque nature of the Indian real estate market.
- Only 38% NRIs having invested, are happy with their project and the builder.
- 72% are ready to invest, notwithstanding the economic outlook or the cycles of macro-economic ups and downs, if developers adopt best practices.
- Less than 34% NRIs are presently ready to commit to an investment in the Indian property market.
- 62% expat Indians complain that the developers’ sales team behave differently during the pre-purchase and post-purchase periods.
- 57% NRIs demand that the documentation of the developers, including the offer letter and the builder-buyer agreement, should be foolproof.
- 72% NRIs demand an online option to get their apartments customised as per their needs.
- 70% expat Indians want to be involved in the design and construction phase.
- Rental assurance is a priority for 60% of the NRIs.
- 92% NRIs are ready to pay for a reputed developer.
- 80% NRIs maintain that the property shows by Indian developers in their country of work, only matter to them as project information guides.
- Road shows or advertising campaigns only tempt 28% of NRIs.
(The writer is CEO, Track2Realty)
Source: https://ecis2016.org/.
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Source: https://ecis2016.org
Category: Lifestyle
