Indian Rupee Depreciation May Boost NRI investments in Real Estate Sector..!

Real estate consultancy  company  Cushman & Wakefield (C & W) has said a depreciation in the Indian rupee's value provides a psychological boost to both non-resident Indians (NRIs) as well as developers / promoters.

Ms. Shveta Jain,  Executive Director (Residential), Cushman & Wakefield said, " If the Indian rupee maintains its current levels, developers / promoters could see more interest from NRI buyers as long as the capital value levels are also maintained and do not see a big hike during the period"

At current rupee levels & sluggish market conditions that are expected to remain that way for the next few months, NRIs could possibly benefit substantially from some attractive options available in the markets, Ms. Shveta Jain said.

 

Ms. Shveta Jain,
 Executive Director (Residential),
Cushman & Wakefield

"Though it is commonly felt that with each depreciation cycle, NRIs will find it cheaper to invest in the sector, this does not happen immediately," Ms. Shveta Jain said.

She said the primary reason for this is the logistical constraints, like identifying the right property, negotiating a deal, being able to repatriate large sums of money in outright purchases and completing all the necessary documentation & formalities during the transaction life-cycle.

"A typical purchase transaction may take a NRI buyer a period of a month to three months. During this period, the Indian rupee may strengthen & the notional advantages that could accrue due to the rupee's depreciation could be lost " she also said.

Besides, in such a situation, if the purchase is not outright and the NRI buyer needs to either pay in instalments or he / she is booking an under construction property, there may not be a guarantee that he /she  will continue to enjoy the benefits of a depreciated rupee during the payment life-cycle.

"In the short term, the depreciation of the rupee may mainly benefit those buyers who are already in the process of finalising an existing transaction where they have still not converted their foreign exchange into Indian rupee to pay for their purchase" Ms. Shveta Jain added.

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