NRI demand for luxury homes is back post-Covid

New Delhi, Feb 24 Demand for luxury homes in India has improved among the Non Resident Indians (NRI) in the post-Covid scenario, according to Anarock's latest consumer survey.

The Anarock report said at least 73 per cent NRIs now prefer properties priced in the range of Rs 90 lakh to Rs 2.5 crore.

In the pre-Covid survey (2nd half of 2019), just 41 per cent of the NRI respondents preferred properties within the high-end price bracket and most favoured affordable and mid-segment homes.

Further, three and four BHK options currently top their wish-list, it said.

The IT hubs of Bengaluru (24 per cent) and Pune (19 per cent) are seeing the highest NRI demand. Collectively, these two cities saw around 48,370 homes sold in 2020, accounting for a 35 per cent sales share among the top seven cities.

Prashant Thakur, Director and Head of Research, Anarock Property Consultants said: "The COVID-19 pandemic has increased NRIs' emotional association of long-term security with physical assets. 63 per cent of the polled NRIs state this as their reason for buying homes in India now."

He said that NRIs are also driven by the uncertainties posed by COVID-19. Luxury properties have emerged as a hot favourite with NRIs because of the depreciating rupee value translating into greater buying power, coupled with ongoing developer discounts and offers.

"A majority of NRIs is buying for end-use, not as investments," Thakur added.

According to the survey, at least 67 per cent of the polled NRIs are looking for ready-to-move-in homes. If we consider the overall survey trends, including NRIs and resident Indians, just 29 per cent preferred to buy ready to move in homes, with another 27 per cent respondents preferring under-construction properties that will be delivered within a year.

Of the total 24 per cent survey respondents who already booked properties in the last six months, at least 38 per cent were NRIs looking to make the most of the prevailing market conditions in India, including discounts, offers and lowest-best home loan rates.

According to the survey, most of the polled NRIs seeking property in India are aged between 35-45 years of age. Among all NRI respondents who participated in the survey, close to 68 per cent considered real estate as the best asset class for them at this time.

Regarding their outlook on residential property prices, at least 44 per cent respondents felt that prices will remain stable in the short-term (12 months), while 27 per cent feel they will increase during the year. Over the long term (5 years), 92 per cent NRI respondents think prices will increase.