Luxury real estate holds much higher value than being just a status symbol. For the affluent class of India, luxury properties are a futuristic investment that blends all the layers of the need pyramid – basic roof, capital appreciation, lifestyle upgradation, and a diversified portfolio. Such a huge demand wave cannot be sufficed in the domestic borders. Thus, the interest towards overseas real estate is evidently increasing.

As per the India Luxury Residential Outlook Survey 2025 by India Sotheby’s International Realty, HNIs and UHNIs’ interest in overseas real estate has doubled over the past 5 years taking the number for 10% to 22%. Owning a property across borders is not just a far-fetched dream but a preemptive reality. As real estate gains momentum in the investment portfolio of HNI and UHNIs, they are curious about the variety that is available across borders. Be it an elite penthouse overlooking the skyline of New York, a massive duplex that takes you beyond clouds in Dubai, or a vintage home that holds heritage value in London, people with high net worth are open to evaluating such variety. With the ongoing fascination over the “most desirable postal codes”, investors are using the global mobility to make this aspiration their reality. Multi-billionaires like Mittal, Poonawalla, and even entertainment celebrities of the country have built an overwhelming fortune with their real estate investment overseas.

I. What triggers this surge?

Global real estate is not just four walls sold with some augmented features. Living overseas in a self-owned property appeals to the aspirational instincts of HNIs and UHNIs. The upgradation of lifestyle, the added value to the portfolio and wealth, and better exposure to global economy are the major motivators.

• Capital appreciation: Cities like London, New York, and Dubai are well established business hubs on a macro level. They demonstrate long-term appreciation.

- Dubai’s residential prices have seen a significant growth of 6.8%; it is estimated to witness a further 15 – 20% rise by the end of this year (2025). This growth is driven by infrastructure development under the 2040 Urban Master Plan.

- Such movements attract both capital and corporate set ups which stimulates career options attracting workforce, ultimately increasing the housing demand. For investors, it’s a steady compounding story with international liquidity.

• Currency hedge: During periods where value of rupee depreciates or domestic inflation, the value of these global assets often holds or appreciates, enhancing the wealth preservation function of the asset class.
• Rental scope: Luxury real estate in high-rated markets is a preferable option for premium rentals. Due to a high influx of executives, diplomats, and exchange students, the demand for rented accommodations almost never goes out of business.

- Dubai's rental yields are generally high with average returns ranging from 7% to 11% annually. Central London, rental yields range from 3.5 to 4.5%. New York has a similar range with an established tenant base.

- The established rental market coupled with impressive returns makes investment in overseas property lucrative.

• Price – to – value comparison: Overseas residential purchases are cost heavy, but Indian investors are not fixated on per square foot price.

- While making the decision, the cost might be substantially high, however, they factor in the better quality of life, global infrastructure, better rental yields, and the legacy the cities hold. Once included, the entire cost analysis makes sense.

- For example, the Upper East Side in New York or Central London reflects city’s prestige and stability as against others.

• The value of life, education, and legacy: Apart from the quantifiable benefits, overseas property ownership is an aspirational need for many.

- The lifestyle, the elite educational universities, and the global exposure urges this shift. In 2024 alone, over 1,40,000 Indian students received UK study visas—a 35% rise—creating demand for family-oriented housing in areas like Kensington and Ealing.

- These homes often become multi-generational legacy assets as well, passed down not just for their monetary worth, but for their symbolic global footprint too.

However, the process to build a legacy is not a path of roses. There are obvious hurdles in the process.

II. What might stop you!

• Regulatory scenario:Every country has set up a different tax regime for foreign investors.

- In the US, non-resident investors are subject to federal and state levies, including FIRPTA (Foreign Investment in Real Property Tax Act), which withholds tax on sale proceeds.

- In the UK,15% Stamp Duty Land Tax (SDLT) is imposed on foreign buyers. Further complexities arise with capital gains, rental income taxation, and estate duties.

• Unawareness of legalities & local knowledge: Any gap in the title clearances, zoning regulations, market scenario, and developers’ reputation results in an expensive mistake. Moreover, local councils and their relevant rules might pose as a hurdle.
• Recurring expenses: Any luxury property, be it domestic or international, incurs a high upkeeping costs in the form of maintenance. Service charges, building maintenance and tenant management, these hidden costs can dent yields and add to the logistical burden.
• Change in policies: As the market evolves, the regulations pertaining to rents, property ownership, registrations etc. change. Any hits and misses there would again demote the process. Complete awareness, real-time updates, and a long-term planning is required when one invests in global properties.
• RBI’s LRS cap: India’s Liberalized Remittance Scheme (LRS)has a cap for individuals’ remittances. $250,000 per financial year is the cap set. Families can use pooled limits (up to $1 million), however, luxury real estate in prime London or New York markets often exceeds this. Compounding the issue is a six-month usage clause, limiting investment flexibility.

The scope of overseas luxury real estate is manifold. The growth curve of India has seen a substantial rise with good news in all directions. The spending ability of everyone is rising and their understanding of real estate being a safe investment is growing. Coupling these two facts and adding the influx of Indian developers in international market encourages these trends.

The familiarity with the Indian brand, the attractive returns, the diversified options, and aspirational triggers combined reflects a growing future for overseas property ownership.

However, the process must be carried out with utmost precision with thorough due diligence, regulatory awareness, and trusted local partnerships. If done right, a home overseas can be a legacy you pass down to your coming generations rewarding them both tangible and intangible values across borders.

**Excerpts and data taken from "The Economic Times articles authored by Akash Puri, Director at International, India Sotheby's International Realty