Written by: Ashish Kukreja, Founder & CEO, Homesfy.in & mymagnet.io
India’s real estate market has witnessed a transformative surge over the past decade, driven by a growing economy, rapid urbanisation, and evolving consumer preferences. Amidst global economic uncertainties, India has become a beacon of stability and growth for real estate investments. Non-resident Indian (NRI) real estate investment in India is a powerful opportunity combining profitable returns with an emotional connection to their roots.
According to reports, in 2019 and 2020, NRI investments contributed 10% of real estate investment in India, continued to surge to 15% in 2023, and are speculated to reach 20% in 2025. Several factors have contributed to the increase in NRI investments in India.
Emotional and Cultural Connection
A key motivator for NRI investments in Indian real estate is their emotional connection to their homeland. For many, buying property in India goes beyond finances; it fosters ties to their cultural roots and family. This bond is firm among those planning to return to India, as owning a home offers a sense of belonging and security while reflecting their identity and heritage.
Depreciation of the Indian Rupee
The Indian rupee has depreciated against major global currencies, including the US dollar and the euro, making India’s real estate and other investments more attractive to NRIs. Over five years ago, on 1st January 2020, the exchange rate was approximately ₹71.23 per US dollar.. As of 21st January 2025, it is trading at around ₹86.57 per US dollar, indicating a depreciation of about 21.5%. The depreciating Indian rupee has allowed NRIs to invest in Indian real estate at comparatively lower costs.
Government Reforms and Policies
Government reforms have made it easier for NRIs to invest across different sectors. The Real Estate Regulatory Authority (RERA) has brought greater transparency and accountability, making the property buying process more secure for NRIs. Additionally, implementing the Goods and Services Tax (GST) has simplified tax structures, reducing complexities and improving overall market efficiency. Diverse investment options, from government securities to innovative choices like Real Estate Investment Trusts (REITs) and fractional ownership, are helping NRIs to diversify their portfolios.
High ROI
The potential for high returns on investment (ROI) in Indian real estate is a significant factor driving NRI interest, particularly in fast-growing cities like Hyderabad, Bangalore, and Pune. These cities have experienced substantial economic growth, driven by thriving IT sectors, infrastructure development, and a strong talent pool. As a result, the demand for residential and commercial properties in these locations continues to rise, offering lucrative opportunities for investors.
Booming Rental Market
India’s rental market has experienced significant growth over the past three years, offering a reliable source of income for NRIs. With a limited supply of ready-to-move-in homes, rental property becomes a primary choice for city dwellers. Capitalising on this opportunity, NRIs prefer investing in rental yields with reliable sources of income.
The luxury market takes the stage.
The demand for premium and luxury housing in various Indian cities is increasing, primarily driven by NRIs. Approximately 25% of sales in this segment come from NRIs, who are increasingly confident in investing in high-end properties due to improved regulations, greater transparency, strong rental returns, and colossal capital growth.
Top cities for High NRI Investments
Major metropolitan areas, including Mumbai, Bengaluru, Hyderabad, Pune, and the Delhi NCR, are witnessing substantial infrastructure development, enhanced connectivity, and the evolution of robust business ecosystems. These cities present significant growth potential while offering comparatively lower entry costs, positioning them as ideal destinations for value-driven investments. Simultaneously, the luxury real estate segment is flourishing in prime locations such as Goa, where spacious properties with premium amenities cater to NRIs seeking lifestyle enhancements and long-term investment returns.
The Future of NRI Investments
The future of NRI investments in India appears promising, driven by economic stability, enhanced real estate infrastructure, and favourable regulatory reforms, as India positions itself as a global financial powerhouse. NRIs see India as a secure and lucrative investment destination. The government’s commitment to infrastructure development, smart cities, and affordable housing has created numerous investor opportunities to return home to be closer to family or capitalize on the strong real estate market; the demand for Indian properties will remain strong.
Beyond traditional investments, NRIs are interested in premium assets such as luxury homes, holiday properties, and commercial real estate, especially in tier-I and tier-II cities. The rise of proptech and virtual platforms has streamlined property transactions, enabling NRIs to manage their investments remotely. With ongoing urbanisation and growing demand for quality housing, India remains a resilient and attractive market for NRIs seeking long-term returns and diversification.
Disclaimer: Views expressed are personal and do not reflect the official position or policy of RealtynInfra. Reproducing this content without permission is prohibited.
