Real estate transactions in Bengaluru are dominated by non-resident Indians from the US

Fri, 06/07/2024 - 07:47

Author: JLL



North Bengaluru attracted investments from about 40% of NRIs. 78% of Bengaluru's home sales are apartments with two and three bedrooms, making them the most popular investment options.

With a sales share approaching 15%, Bengaluru is still a popular destination for non-resident Indian customers. NRIs from the US are the main force behind the housing market demand.

Nearly 15% of Bengaluru's home sales are to non-resident Indian purchasers, who are still drawn to the city. NRIs from the US, Singapore, UAE, Australia, and Saudi Arabia are the main drivers of the real estate market in the IT capital, with most of them choosing to invest in 2 and 3 BHK apartments.

In terms of demand and transaction, the US has significantly outperformed other nations. Based on statistics given by Nobroker, there has been a rise in demand from NRIs based in Singapore, the United Arab Emirates, Australia, and Saudi Arabia.

Preferred investment options in Bengaluru
Apartments with two and three bedrooms are the most popular investment options; they account for 78% of sales. According to data released by Nobroker, North Bengaluru was the most popular place for NRIs to invest, with over 39.7% of them doing so. East Bengaluru came in second with 37.7%, South Bengaluru came in third with 18.1%, West Bengaluru with 3.9%, and Central Bengaluru with 0.5%.

With over 40% of sales, the North has the greatest traction from NRI purchasers, followed by the East with 38% and the South with 18%. According to Saurabh Garg, co-founder and chief business office of Nobroker, the average ticket size in the North is ₹1.1 crore, while in the East it is ₹1.51 crore, and in the South it is ₹1.13 crore, as reported by HT Digital.

Sarjapur, Varthur, Gunjur, and Whitefield are the most favored micro-sites in the East, and Devanahalli and Hebbal micromarkets are the most favored locations in the North.

Apartments with two and three bedrooms are the most popular investment options; they account for 78% of sales. The research indicated that of these, 2 BHK units make up 41%, 3 BHK units, 37%, and plots and 4 BHK/duplex/villa, 9% each.

Most of these purchasers are employed individuals looking for investments with strong rental yields and potential for growth in the future. NRI purchasers do not typically pay premiums for their favored projects; instead, they typically invest in or purchase from only reputable Grade A developers. According to Garg, NRI purchasers actively look for additional services to facilitate their real estate purchases, like as management services and legal support.

NRIs account for 15% of housing sales in Bengaluru
“This has increased in the last two years. This stood at 10% earlier. The highest demand is from Gulf countries followed by the Indian diaspora from Europe, then US and Australia. Most of them prefer 3 BHK apartments and villas,” says Nesara B S, chairman, Concorde, NRI buyers account for almost 15% of their overall sales.

While NRIs opt to purchase 2, 3, and 4 BHK properties. They usually aim for the higher end of the range.

“Most of our bookings are either through our GCC office or through trade expos that happen abroad. Sometimes we also have enquiries when they visit Bengaluru during holidays,” said Viswa Prathap Desu, COO, Residential, Brigade Group.

From the standpoint of sales, NRI's annual contribution would be roughly 15%.

“NRIs typically prefer larger homes and gated communities with a clear focus on amenities, security and property management services. NRI contribution to our overall business is in the range of 12 to 15% and we see growing traction from markets like GCC, US (both east and west coast) followed by SEA and Europe (including the UK),” said Abhishek Kapoor, Group CEO, Puravankara Ltd.