RBI curbs on overseas property investments to protect the rupee seems to be good news for Indian real estate as capital which otherwise would have been diverted abroad will now stay in the country.
According to Anuj Nangpal, Managing Director, Investor Services, DTZ India, the announcement, however, does not clarify as to what will happen to partially completed overseas property transactions where part payment has been made.
In its bid to control the outflow of capital from the country, RBI slashed the annual cap on automatic outflows from $200,000 to $75,000 for an individual. Along with it, a ban has been imposed on overseas real estate purchases with immediate effect.
In recent times, there has been a surge in Indians buying properties in Dubai, Singapore, Malaysia and the suburbs of London.
“These investors interested in real estate will now be restricted to consider properties only within the country. This is likely to give a boost to real estate demand in the country, especially in the premium and luxury segment, as these investors are mostly high net worth individuals (HNIs),” he said.