Housing Markets That Changed the Most
The housing market in India has come to a halt. Home sales and residential construction have fallen precipitously as the economy has experienced its worst decline on record as a result of the coronavirus pandemic, and, excluding Hyderabad and Ahmedabad, real house prices in major cities have been falling.
According to the Reserve Bank of India (RBI), the country’s central bank, the All-India house price index increased by 3.92 percent y-o-y in Q1 2020, marginally higher than the previous year’s 3.64 percent rise. When adjusted for inflation, however, house prices in the United States fell 1.21 percent. House prices dropped 0.25 percent on a quarterly basis (-0.96 percent inflation-adjusted).
Construction activity in the residential sector is declining. According to Headways Realty, only 12,564 housing units were introduced in Q2 2020, a massive 80.7 percent decrease from the previous quarter. The number of launches in the first half of 2020 was nearly 65 percent lower than the same timeframe last year. After a lockdown was enforced in late March and extended many times, India’s economy shrank by 23.9 percent in Q2 2020 from a year earlier, in stark contrast to y-o-y growth of 3.1 percent in Q1 2020 and the largest contraction on record. Fitch Ratings forecasts a 10.5 percent drop in GDP in FY21, more than double the 5% drop it predicted in June.
Purchasing real estate in India: A foreign national living in India does not need the RBI’s permission to purchase real estate in India. When he becomes a citizen of India, he has the same privileges as any other resident. People of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, and Bhutan, however, do not have this right. A foreign national of non-Indian descent residing outside of India, on the other hand, is unable to purchase any immovable property in India. Foreign nationals cannot own property in India unless they have lived in the country for 183 days in a financial year (a tourist visa lasts for 180 days). Purchasing property on a tourist visa is also prohibited.
Furthermore, land cannot be bought in the name of one eligible individual and one non-eligible person jointly. This means that a non-resident Indian (NRI) or a foreign national of Indian descent (PIO) cannot jointly purchase a property with a foreigner.