NRI Real Estate and Property Investment in India
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Increasing Interest Rate Brings a Time to Rejoice for NRIs
Monday, April 09, 2007

In an effort to control the surging inflation, the Reserve bank of India (RBI) increased the interest rates. This created a tense situation for the Indian Stock Market as it plummeted by over 600 points.

Though, the market shown a quick recovery but scared the investors about future prospects. However, it is certainly a time to make killing for long term investors. Taking an intelligent move are Non Resident Indians (NRIs) who are believed to have invested a handsome investment of Rs. 1 crore in just two months of February and March. Earlier, high rupee-dollar rate and other valuation concerns were putting off NRI investments.

But, they returned back as the Indian market witnesses corrections. It was an entirely different situation when the rupee appreciated and the market was at a new high. Encouraged by the new developments, NRIs are being bullish on scouting the ways to enter into the market again.

The mutual fund has also eased off thereby offering lucrative investment options for investors. Portfolio investments by corporates, foreign institutional investors (FII) as well as NRIs marked $6.8 billion in the period from April 2006 to January 2007. Mass Exodus from the market does not seem to be any possibility in the near future due to strong basic economic fundamentals and economy is still likely to grow by 7-8%.

The increasing interest rates will certainly cool down the overheated Indian Economy. NRIs should not hurry off the things as the market can go down further. Since, no one can forecast the future, entering the equity market seem to be the best possible approach. Also the NRIs looking forward to make hard cash on their investments should consider buying properties in India. Many NRIs could not turn their dream of buying a home in India into reality because of various reasons.

Now, NRIs have again got a chance to fulfill their desire by monitoring the easing of prices. As such, Gulf NRIs seem to be benefiting the most as they are always seen to be overpowered by the craze to invest in real estate. Since they prefer Tier Two or even smaller townships and villages, they benefit the most from lower housing prices. With interest rates hitting the sky, it is the best time for NRIs to wait and watch their investments to reap the best returns.

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