The results are already being felt in the Chennai market. At a recent property exhibition in Dubai, a youth from Coimbatore who works in Dubai signed a cheque for 8.7 crore to buy 10 apartments in an integrated township on GST Road and two town houses in another gated community at Oragadam from Chennai-based developer Arun Excello.
Few major developers miss the Dubai exhibition as it helps them reach out to the NRI community. P Suresh, Arun Excello MD, said, “compared to previous years, the interest among Indians living in Dubai to invest in India is more this year. Dollar appreciation and stability in Chennai real estate prices can be cited as the reasons for this phenomenon. Investors are choosy. They park money only in projects that are progressing fast.”
The Dubai market, which had crashed following the fall of global financial services firm Lehman Brothers in 2008, has made a significant recovery in the past one year. In 2012, the residential market in the emirate appreciated by about 10%, according to Dubai Land Development authority’s statistics. During the year, real estate transactions in Dubai increased by 8% to Dh 154 million, said Ashutosh Limaye, head, research at JLL. Dubai, despite its fall and delayed recovery, continues to be the most favoured property investment destination in the Middle East.
This recovery is backed by huge investments made by expatriates, particularly those from India. Non-resident Indians are among the top five investor communities in the region.
With their natural affinity towards India and in the backdrop of the depreciation of the rupee against the dollar, they are expected to show greater interest in the Indian real estate market. Moreover, most Indian markets have seen an appreciation of more than 40% since the 2008 fall, said Limaye.
A recent survey conducted by Sumansa Exhibitions, organisers of the annual India Property show in UAE, shows that NRIs place a higher intrinsic value on property owned in India over that of property owned in Dubai or elsewhere. Dubai responds well to high end and mid segment projects, said T Chitty Babu, Akshaya MD.
He said, “the large Indian diaspora in the Gulf is an attractive market for Indian property developers. Setting up a beachhead in the UAE augurs well to capture NRI property investors looking for safe and reliable investment opportunities in their homeland.”
Like many other Chennai builders, Akshaya has a permanent office in Dubai. Inquiries from NRIs have been on the rise in recent weeks, said Babu.