Hyderabad, NCR, Bengaluru top choices for NRIs investing in houses: survey

Study says over 77% of NRIs looking to buy bigger homes, with 54% favouring 3BHKs and 23% wanting 4BHKs

According to a recent survey by CII and Anarock, the majority of Non-resident Indians (NRIs) are looking to invest in residential properties in Hyderabad, the National Capital Region (NCR), and Bengaluru, amid a buoyant residential market and a depreciating rupee.  

The survey was conducted in India and various countries, and covered the first nine months of the current calendar year. Of the 5,500 respondents in the study, seven per cent were NRIs currently stationed in the US, Canada, Gulf, Europe, and various Asian countries. The remaining were resident Indians

According to the survey, at least 60 per cent of the NRI respondents want to buy homes in one of these three cities, with 22 per cent focused on Hyderabad, 20 per cent on NCR, and 18 per cent on Bengaluru.

Bengaluru, Pune and Chennai were the top picks for most NRIs in the last survey conducted in the corresponding period a year ago.

More NRIs prefer investing in Indian real estate over stocks, mutual funds, gold, and fixed deposits.

Seventy-one per cent of NRI respondents in the latest survey saw Indian housing as the best investment bet. In comparison, 55 per cent preferred housing investments in India during the pre-Covid survey.

"Despite the worst of Covid-19 now over, NRIs have clearly not forgotten the uncertainties associated with living in a foreign country during a major pandemic," said Prashant Thakur, Sr Director & Head-Research, ANAROCK Group.

While domestic homeownership sentiment remains strong despite hardening home loan interest rates and property prices, the depreciating rupee value against the dollar gives NRIs a distinct advantage, he said.

Housing has seen a 15-20 per cent increase in NRI demand in the first nine months of 2022 compared to the corresponding period in 2021.

Thakur added that the January-September period of 2022 saw about 273,000 homes sold in the top seven cities. Further, NRIs account for 10-15 per cent of homes sold in any given quarter.

Demand for bigger homes remains one of the defining new developments in the post-Covid times.

The survey also highlighted that the favourable exchange rate is another prime motivator to secure bigger homes for NRIs. The survey finds that over 77 per cent of NRI respondents will buy bigger homes, with 54 per cent favouring 3BHKs and 23 per cent looking to buy 4BHKs.

In comparison, just 22 per cent of NRI respondents are now looking for 2BHKs. In the pre-Covid survey, at least 40 per cent were looking for 2BHKs.

Many NRIs are now looking to shift back to India and actively use these homes. The current economic situation in many countries is uncertain because of the recessionary dynamics brought on by the Ukraine-Russia war, while the Indian economy is much better off.

Top-3 favourable cities for investment in India

Pre-Covid (H1 2019)	Covid (H1 2021)	Post Covid (H1 2022)
Bengaluru	Bengaluru	Hyderabad
Hyderabad	Pune	NCR
NCR	Chennai	Bengaluru

NRIs' most preferred budget range (in Rs)

Pre-Covid (H1 2019)	Covid (H1 2021)	Post Covid (H1 2022)
90 lakh-1.5 cr	1.5 cr-2.5 cr	90 lakh-1.5 cr
55%	59%	63%