Policy changes to attract NRIs to Indian realty
The Indian property market has always been quite attractive for non-resident Indians (NRIs). The only concern, has been with the opaque nature of the business, with its lack of information and scientific process of due diligence. However, with some of the key policy changes in 2016, like the Real Estate Regulation Act (RERA), demonetisation, the goods and services tax (GST and the Benami Transaction Act, the moot question now, is whether NRIs can be more confident in making an investment decision. Indian real estate sector witnessing a gradual transformation Naushad Panjwani, managing partner with Mandarus Partners LLP, agrees that Indian real estate sector faces a huge trust deficit issue, owing to the absence of an effective regulator like in other sectors (SEBI, TRAI, IRDAI, etc.), the scarcity of organised funds for projects, the nexus between developers, politicians and bureaucrats, lack of title insurance and the poor rate of disposal of court cases. PNC Menon, chairman-emeritus of Sobha Ltd, maintains that the Indian real estate sector has matured to a point, where NRIs can invest in a wide variety of products, across the affordable, mid-range and luxury segments. “With tighter regulations, greater transparency, more affordability and enhanced price stability, NRIs will find interesting investment opportunities, as long as they have a long-term view and are discerning about which project to invest in. India is a huge market with over 1.2 billion people and an emerging economy on a global front,” says Menon. Policy changes will bring greater transparency for NRI investors Kaizad Hateria, brand custodian and chief customer delight officer, Rustomjee Group, believes that bold steps like demonetisation, will increase transparency in the real estate sector and curb unaccounted cash transactions. “Greater transparency, will improve the element of trust in the Indian realty market and this will make NRIs more confident about investing,” says Hateria. Hiral Sheth, director marketing with Sheth Creators, points out that real estate is the second-largest sector in India. To simplify the processes of purchasing property, several rules and regulations have been amended. “Factors like FDI in the real estate sector, relaxation of laws by the Reserve Bank of India (RBI) regarding property buying by NRIs and lenient policies vis-à-vis the Foreign Exchange Management Act (FEMA), have accelerated investments. Also, the availability of affordable properties, attracts a large number of urban NRI buyers,” says Sheth.
Tags : News/Views