[nishantgandhi]

India Doesn’t Suit your Budget? Invest in UK, US or Dubai

If investment in Indian Real Estate seems to be out of your budget, go for UK, US or Dubai. Sounds unbelievable but its true! Real Estate prices in south and central Mumbai is higher as compared to prices UK, US or Dubai. And the best part is, you get all of it without excessive pollution and slums all around you.

Thanks to a foreign exchange relaxation, Indians can now legitimately remit up to $200,000 (Rs79.26 lakh) every year for investment purposes, including property. With two persons (you and your spouse), the amount can be raised to $400,000 a year, enough to buy you decent property in many global cities.

In a budget of around Rs80 lakh will expel you to the outer border of Mumbai’s western suburbs. On the other hand, a two-bedroom-hall-kitchen (BHK) flat at Dubai’s Marina would cost Rs35-60 lakh. More opulent residential configurations would cost Rs1 crore and above. This is a steal compared to rates in Mumbai. In Dubai, Indians cannot actually buy property, but they can lease one for 90 years. On this basis, it is possible to obtain four-bedroom luxury apartments or even decent-sized villas for up to Rs1.5 crore.

Similar investment won’t be able to fetch property in New York or London, but you can get great property for Rs4-5 crore — upwards of around £500,000 — which is what decent property in south and central Mumbai now costs.

(Source: India Doesn’t Suits your Budget? Invest in UK, US or Dubai)
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This is ACTUALLY true. The initial impression that many people have is that a) Indians cannot own property in Dubai (FALSE) or b) Real estate is expensive in Dubai (Not completely true). After studying and comparing the real estate markets in India and Dubai closely, I figured that Dubai properties are more Value-For-Money, as they are high rental yields.

At present, rental yields in Dubai are averaging 10-12% (nowhere else in the world!) on your property value. And this has been the case over 1.5 years now. Sure, everyone thought that this is a bubble and will burst soon (me too!). But I have personally seen the property and rental prices just going upwards YoY.

[khanak]

While nothing can ever replace Mumbai, property is becoming more and more expensive. I guess its time we start looking somewhere else.

[Steeroid]

Originally Posted by nishantgandhi

On the other hand, a two-bedroom-hall-kitchen (BHK) flat at Dubai’s Marina would cost Rs35-60 lakh.

Who wrote this bull****?

2BHK Dubai Marina = starting at 1.5 crores.

[nitrous]

I seen shocked american faces when they're told about the sq.ft. prices in the metros.

[ramie2400]

i hardly believe that UK,US,dubai properties are cheaper than India?????

[nishantgandhi]

Originally Posted by Steeroid

Who wrote this bull****?

2BHK Dubai Marina = starting at 1.5 crores.

Yes, even I agree Steeroid. Heck, when I was there in 2006, a 1 BHK in Marina was 800K-1 million AED, which makes it a crore INR. I am sure prices have gone much higher now.

[benbsb29]

I guess the thread initiator must have gotten inspired by a show on property on Zee Business channel which suggested something on similar lines.

[nishantgandhi]

Originally Posted by benbsb29

I guess the thread initiator must have gotten inspired by a show on property on Zee Business channel which suggested something on similar lines.

Not really my fried, Dubai and Mumbai real estate markets have always interested and intrigued me. So when I got an email with this article, I just thought of posting it up on the forum and added my opinions to it. FYI, I havent watched the Zee Business Channel show that you mentioned.

[bigman]

I read similar stories in the UK prices. In terms of land prices Mumbai was in the top 3 (most expensive).

[nishantgandhi]

Here's something from today's edition of TOI


Mumbai 5th most costly office space

NEW DELHI: Nariman Point is the fifth most expensive office location in the world. Rentals here have zoomed 60% to Rs 546 per sqft per month during the year, according to the latest survey released by global consultancy firm Cushman & Wakefield. The steep rise saw Nariman Point go up from the seventh slot in the previous rankings.

Delhi broke into the top 10 with rentals in the Connaught Place area, the central business district (CBD), estimated at Rs 423 per square foot a month. Despite talk of moderation in the real estate arena, rentals in the area have increased 46% during the year.

In the global market, Asia emerged as one of the highest growth markets. And in Asia, India is the main driver. According to the report, within the Asia-Pacific region, India captured three of the top 10 most expensive locations with Mumbai-Nariman Point and Central Mumbai-Worli on third and fourth position respectively and New Delhi’s Connaught Place at sixth position in Asia-Pacific. In fact, the significant rental growth witnessed in India has placed eight Indian micro markets in the top 10 locations in terms of rental growth in Asia-Pacific region. The central business districts of Mumbai and Delhi are costlier than the most posh office areas in cities like New York, Washington, San Francisco, Rome, Zurich, Shanghai, Dubai and Frankfurt.

While Nariman Point moved up a few notches in the latest survey, Mumbai Central slipped two places to seventh position during 2007.

The change in the ranking was mainly due to the 60% rise in rentals in Nariman Point compared to 33% in Central Worli. Other areas like Suburban Powai saw rentals rise 80% during the year to Rs 110 per sqft a month.

In the northern region, Gurgaon prime, which includes areas like DLF Phase I and office space on NH-8, witnessed the highest appreciation of 47% with rentals rising to Rs 113 per sqft a month.

India is still the best performer in the office space market in the world, with average rentals growing around 36% as against an average rise of 25% in the Asia-Pacific region. In the US, rentals rose 18% and Europe saw a 14% increase.

Executive managing director of Cushman and Wakefield, South Asia, Sanjay Verma, says that most micro-markets in Mumbai saw an upward trend in rental values due to low vacancy and lack of new supply as projects were delayed. However, high rental values across the country are not sustainable beyond the next 12 months, given the significant IT-specific real estate supply planned in 2008, he added.

The review said that the rental growth across the world has been driven largely by a lack of supply in the face of strong demand. Vacancy rates have fallen considerably in many markets over the year, but developers have remained relatively cautious.

The highest growth in rentals was achieved by Kolkata’s Rashbehari Connector with an increase of 86% to Rs 65 per sqft a month, followed by Powai in Mumbai at 83%, Andheri and Malad recorded 71% and 64% respectively.

In the southern cities, Hyderabad’s CBDs Begumpet and Raj Bhavan Road emerged as the highest rental riser at 44% to Rs 52 per sqft per month while other markets within cities like Pune, Chennai and Bangalore witnessed increase of 27%, 24% and 26%, respectively. In Bangalore, CBD rentals went up to Rs 73 per sqft a month.

Mumbai 5th most costly office space-Mumbai-Cities-The Times of India

[sushrutha]

Last week I saw on NDTV, an apparment is comming up in Mumbai, Guess the price ... Whopping 60 Crores .... Too much i say

[nishantgandhi]

Originally Posted by sushrutha

Last week I saw on NDTV, an apparment is comming up in Mumbai, Guess the price ... Whopping 60 Crores .... Too much i say

NCPA (Nariman Point) has one of the most exclusive addresses in Mumbai. The last reported sale there was an apartment for INR 34 crores for (I think) a 3000-odd sqft apartment. That makes a whopping INR 97,000 per sqft!

I think a couple of months back, Uday Kotak purchased a house at INR 65,000 per sqft which was at that time the highest reported residential space price.

I say Mumbai real estate market is crazily over priced

[sindabad.sailor]

Found this old thread by an accident here on team - bhp.

Since this was written in 2008, it left me windering how is the scene today?

I was reading a lot of net published articles in last few days. Some claimed that the Dubai property prices have recovered to 2009 levels. Whereas umpteen number of articles claimed that the property prices in dubai are way too low compared to those in 2009.

I am currently not investing in india RE as I own a home now. Also IMO we end up paying more than twice the rate psf. Due to superbuilt up calculation, we as such receive nearly 35-40% leass sq.ft. to live and our crazy bank rates actually make us cough nearly twice the principle amount.

On this background, how does investing in places like UAE sound in todays situation. Rentals were good earlier but my friends from UAE tell me that rentals would fall drastically this year onwards as there would be huge supply of completed apartments this year.

Has anyone got first hand experience? I transited UAE a month ago and our company agent who was ferrying me from seaport to airport mentioned that nowdays foreign nationals can buy freehold properties as well. How far is that true?

Rgds.

[shivshanker]

for normal salaried and WHITE income folks, Is the "Second home" a really sound investment, I personally do not think so.

The cost of capital, the interest you would pay on the loan amount, the maintenance charges etc etc. are factors which needs to be closely examined not to mention the capital gains etc.

If to the above complex equation one were to add, an Off shore realty investment, think this is really the formula for a disaster.

First hand experience,
1. Normally in the middle east countries, the banks want you to take an term cover with the Bank as the beneficiary. Added Costs.
2. It is supposed to be a Free hold property, however if you want to sell, you need the developer (the arab) to agree with you on the sale price, else you are stuck. like many now who want to cut their losses and sell in Dubai cannot as the developer does not want to come to the table to negotiate.
3. Rentals in Dubai were really down till this year, I hear it is picking up now.
4. They offered free VISA's to people who bought free hold property, but now .. after 3 years are over .. nobody know in Dubai how to renew them.

The list can go on and on .. it would depend upon person to person.