Home Away from Home: It’s Miami, not Mumbai!

home-nyIt’s raining houses in the US for Indians, quite literally. The US real estate market has been flooded by Indian investments ever since the bursting of the housing bubble in the US and the financial crisis of 2007-08. Since then, property prices have not recovered, making it easy for Indians, especially the new NRIs, to cash in.

A three-bedroom apartment, which would be a distant dream in Mumbai for some, has become a reality in Miami for Indians. And why not? An average three-bedroom apartment in New York costs around $250,000 while a similar one in a tony locality in Mumbai wouldn’t cost anything less than  $400,000. Little wonder then that India-born American realtor Jaswant Lalwani is a busy person ever since the global meltdown. “I have closed 10 deals with Indian buyers in the last three months. And I am working on another 30,”  he says proudly. The Manhattan-based realtor deals with buyers from various nationalities, but of late, he has got more business from Indian clients.

Indians woke up to property buying abroad post 2008. “The property price deflation in foreign countries since 2009 has given opportunity to Indians to buy. The relative value has become attractive and a whole lot of people are open to buying property abroad,” reasons Anand Narayanan, national director, residential agency, Knight Frank.

Indian buyers accounted for nearly $3.5 billion of the $68.5 billion that foreigners spent on purchasing homes in the US during the 12 months ending March 31, according to a survey by the National Association of Realtors (NAR). Indians are among the top five foreign customers who have historically accounted for a bulk of purchase in the US. Canada, China, Mexico and the UK are the top three countries buying property in the US. India accounted for 5% of the total purchase.

Today, prices of homes in US cities, especially New York, are among the cheapest in the world, even when compared with Delhi and Mumbai. The average price of homes in New York is about $1,300 (or Rs 58,500) per sq. ft. In comparison, apartments in Mumbai’s Cuff Parade, a high-brow neighbourhood, would come for Rs 80,000 per sq. ft.

According to NAR, international non-resident clients are likely to be substantially wealthier than the median domestic buyer, and are usually looking for a trophy property abroad after having met essential living needs in their own country.

The most popular destinations for realty investments, as per the survey, were  California, Tennessee, Connecticut and New Jersey. According to information from www.realtor.com, the five markets of greatest interest to potential Indian buyers are Los Angeles, Orlando, Chicago, Dallas and Houston. Indian buyers in these cities include those on visas such as H1-B, but exclude Indian-American or American citizens of Indian origin.

 

 

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