NRI Real Estate and Property Investment in India
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Bangalore Experiences lower Segment Property Investment
Friday, December 7, 2007

With the entry of lower segment (below Rs 20 lakh) properties, drastic changes are expected in the Bangalore's residential realty market. Speaking at a press conference, President Mr.Balakrishna Hegde said, "A few Bangalore developers have already begun to work on an entry strategy for the lower segment and by mid 2008 there entry is expected.

He also said that around three to four Bangalore-based developers have already approached various state government agencies and may launch projects in 2008. "The city is experiencing huge demand about 50,000 units, including flats and houses per year and the property market is no longer dependent on software and BPO employees alone. People working in other sectors like biotech, NRIs, high networth individuals (HNIs) and research institutes and companies have come are showing interest towards property investment in a large number" said Mr. Hegde.

"Based on the demand and bookings made, there are 1.5 lakh units under construction to be ready for occupation in the next three years," he added. 12-15 per cent price hike is expected in 2008 due to an immense upsurge in demand. The rise in 2007 was lower at 7 to 8 per cent due to interest rate volatility and abundant supply from several projects hitting the market. Property market in Bangalore has stabilised in the last six months and also matured with the composition twisting towards actual users rather than investors as seen in the earlier years.

Recently, the city has been attracting huge foreign direct investment (FDI). So far the city has attracted 25 to 30 per cent of total $100 billion FDI which came to India in 2007." Speaking on the NRI market and foreign investment, Suresh Hari, secretary, KOAPA said, "There has been an increased interest shown by NRIs, especially from West Asia, the US and Singapore.

Also a few foreign groups are trying to make their presence felt in the city. There is a considerable amount of foreign funds waiting to be pumped into the sector which will ensure a better quality of real estate bringing newer technology and it will speed up construction.

 

 

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