The Return Of NRI Landlords14 May 2016
56-year-old Jeff Patel and his wife, a couple who migrated from their sprawling bungalow in Juhu-Tara road to San Francisco years ago, now plan to rent it out, after a span of almost a decade. They were among those groups of romantic Indian couples who crossed the seven seas in search of a prosperous life. In the bargain, they did not have the heart to leave out their spacious, duplex house in the hands of tenants. “We did not have the confidence to just let it out to anyone as we would not have been around to check on the space regularly.We were also unsure about the kind of maintenance it would get,“ says Patel.
Hence, the bohemian enclave they left behind remained in solitary confinement for years. And then the tide turned with increasing digitisation and higher rental income over the last one year.It seemed to be exactly the right time to rent out.
“We have more faith in Indian tenants now than ever before. Hence, we are dusting off the soot and cobwebs of our property in Mumbai to rent it out to a loyal and trustworthy tenant,“ says 60-yearold Atrika Basu, a doctor based in London. Moreover, it's now easier for NRI landlords to look up online or look into their social circles to find a tenant instead of going through a middleman, according to Basu. So, what else is motivating the good-old NRIs to rent out their properties?
Manoj Krishnaswamy, business head, King's Square Consultancy says that the High Net Worth Individuals (HNWIs) from the NRI community are lured by the high returns on rentals of premium houses. “Anyway, the resale of high-end houses is not happening. A lot of expats, working across global corporate majors, are willing to take up such houses on rent. The return on such investments is also high (around seven per cent),“ says Krishnaswamy.
It's a fact now that NRI landlords have more faith in expat tenants and foreign companies than Indian ones.“NRIs are very sensitive about losing out their properties to Indian tenants, who take up such places under the Rent Control Act. They trust the expats more. My landlord is also a Canadian citizen (NRI) who stays here in Mumbai. He too likes letting out his place only to the expats,“ says Danny Carroll, an expat. And it is not just the bungalows and highend apartments in some neighbourhoods across Mumbai. A real estate agent based in the city suggested that there are vacant homes lying all across the city, especially in areas such as Andheri west, Thane, Navi Mumbai (Kharghar), Mira road, among others.
Amit Agarwal, CEO and founder of Nobroker.com, says, “We are seeing a surge in interest from Indian HNWIs from countries as diverse as Oman, USA, UK, Bahrain and Singapore. They have become proactive now than ever before due to the digital medium and they are connecting directly with the people seeking rented apartments. Despite the slowdown, they are more upbeat and believe this could fetch them some extra income.“
For some Mumbai brokers, the arrival of this elite bunch of landlords and their fancy apartments have opened up an array of business opportunities. “It's a good thing that homes that were vacant are now brought to use. It's vital to make the most of those properties and repair the houses to address the city's housing needs,“ says Nagesh Dolas, broker and owner of ND Realty Property Development Consultants, based in a western suburb of Mumbai.
At a time of a housing crisis all across the city, such homes will resolve a bit of it, according to experts. “After all, any such buzzing old, vintage house, adds a lot of character to the lane and the area.It will be like a whiff of fresh air, once again,“ chuckles Nagesh.
News Credit - Meghna Maiti, TOI