Austerity' was the most looked-up term in 2010 (according to Merriam-Webster.com), closely followed by 'pragmatic'. These two words completely mirrored the feelings about investment and buying decisions of investors in the western world. These were especially reflected in real estate-house prices in most countries in Europe and the US have either gone down or have remained stagnant.
The absence of local buyers is compelling developers in these countries to woo overseas customers. Even their governments are now more open to foreigners owning property, an aspect that Indians are gradually taking advantage of to drive good bargains. The global recession made the real estate markets worldwide take a strong beating and one they are yet to recover from. Many of these markets still have a lot of foreclosure and short-sale properties on offer, which are available at attractive prices.
However, it is not just destinations in Europe and the US that you can consider. While Dubai and Singapore have been on the investment list of businessmen, celebrities and expats for some time now, new destinations closer home, such as Malaysia and Thailand, have also opened up. Similarly, the UK, especially London, is a highly soughtafter address. The demand is particularly high in the mid-range price sector £4,00,000-7,00,000 (Rs 3 crore-5.25 crore), which means that relatively more affordable locations such as St John's Wood and Kensington are being considered, says a study by Knight Frank, the global property consultancy firm.
It estimates that demand from Indians (along with the Chinese) will go up by 7% annually for some time. "The London property market is one of the most popular. This year itself, people from over 50 nationalities have acquired properties. Indians account for 3.15% of the buyers," says Richa Karpe, director, investments, Altamount Capital Management India. The depreciation of the pound against the rupee from a high of 88 to 75 currently, has also benefited Indian investors as it translates to a 15% discount in prices.
Benefits of an overseas home
For some investors, a property abroad is a holiday home. For others, it is a way of saving on the cost of renting or hotel stay when one is required to be in a foreign country for a long duration. Take Amarpal Singh. The Ludhiana-based exporter recently bought a two-bedroom apartment in Brisbane, Australia, after his two sons went there to study. "The property gives me an assured stay in the country and I can visit any time without having to worry about hotel reservation.
I also save on cost as my children can stay there instead of renting a place," he says. Many buyers like Singh are also discovering that property abroad is as expensive, or cheaper, than in India, which makes it perfect for a second or third home. "Oceanfacing properties in Gold Coast, Australia, which is one of the most visited tourist destinations in the world, are available at around Rs 18,000 per sq ft," says Vikas Arora, managing director, APG India, an agency that sells properties in Australia.
Source: 29. Aug. 2011, ET.