WHY INVEST PROPERTY IN INDIA

Posted on June 15, 2013 Updated on September 25, 2014

Not so long ago, property investment  in India was not considered a lucrative business proposition. The investors used to give a cold shoulder to the real estate investment in a developing country like India. With the booming economy powered by the IT revolution in the country, all economic sectors of India promise great returns on investment.

The liberalized economy of India offers tremendous potential in monetary terms. The Real Estate sector is also reaping the benefits of overall good show by the Indian economy. The India Property Investment Review Quarter 4 2005 research report by Knight Frank predicts close to US$ 1.2 billion worth of real estate investments by the Real Estate Venture Capital Funds in the next one year. The same report estimated Real Estate markets to capture about 18-20% of the total Foreign Direct Investment (FDI) coming to India in 2005-06. Overall, it predicts a rosy future for Real Estate investment in India.

The primary factors that tilt the property investment equation in India’s favor include –

Booming Indian economy. The GDP growth rate is around 8% and increasingly showing signs of northwards trend with the stated intention of 10% growth rate.

Booming IT sector. Information Technology has changed the global definition of India. India has emerged as one of the global software leader. With the increase in spending power of Indians, the real estate market is just waiting to explode.

Booming economic policies. The progress of the nation by leaps and bounds is largely attributed to the ever improving, intelligent and forward-looking economic policies adopted by the successive governments during the past 15 years. The FDI regime is here to stay. FDI has the potential to change the face of India if pursued in the right earnest.

Booming middle class. The Indian middle class is estimated at more than 300 million – more than the entire population of US. Largely English-speaking Indian middle class represent the future of Indian service sector. All this augurs well for the overall improvement in the standard of living in India. And it has just started to improve!

Booming NRI investment. The millions of NRIs are channeling more and more money towards the growth of Indian infrastructure. The restoration of the trust of NRI segment is seen as a big achievement for India since they left India in search of better opportunities and are now finding their motherland lucrative for investments.

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