The Non-Resident Indian (NRI) community has emerged as a powerhouse in India’s real estate sector, injecting crucial foreign capital and profoundly altering market dynamics across various regions. This influx is driven by a powerful confluence of factors: the appeal of strong long-term returns, an emotional desire to stay connected to their roots through tangible assets, and the significant purchasing power advantage offered by a favourable currency exchange rate.
In major metropolitan centres like Mumbai, Delhi-NCR, and Bengaluru, NRI capital is overwhelmingly directed towards the luxury and ultra-luxury segments. Away from the high-octane metros, NRI investment plays a different yet equally vital role in emerging markets such as Kochi, Chandigarh, Pune, and Ahmedabad. This strategic focus is often for high-end second homes or investment properties that meet global standards for amenities, design, and lifestyle.
The result is a disproportionate price surge in these premium micro-markets. Akshat Shrivastava, Founder and CEO of Wisdom Hatch, in a detailed post on X, formerly Twitter, noted that NRIs are playing a pivotal role in the ongoing boom in India’s real estate market. Over the past decade, their share in property purchases has steadily surged — from just 7–10% during 2015–2018, the rise has been consistent: 10–12% in 2019, 12–14% in 2020, 14–16% in 2021, and a reported 17% in 2022, 17–18% in 2023, and 17–19% in 2024. For 2025, early projections indicate the trend could hit a record 18–20%. While this boosts the overall value of the market, it also has a consequential effect on local affordability, making it increasingly difficult for resident mid-income professionals to acquire properties in prime urban locations.
NRI investments serve as a powerful catalyst for development, particularly in Tier-2 and Tier-3 cities, providing reliable funding for developers, which leads to the creation of better-planned infrastructure like roads, airports, and IT parks. This essential growth drives sustained demand, resulting in moderate but steady price appreciation, increased market maturity, and a tangible rise in overall quality of life in these emerging markets. Consequently, NRI capital exerts a dual effect: while it accelerates infrastructure development and fosters new economic ecosystems in Tier-2/3 cities, it simultaneously fuels competition and defines the premium segment in Tier-1 cities, often leading to disproportionate price surges and decreased local affordability.
For this trend to be sustainable and equitable, regulatory attention is crucial. Initiatives like the Real Estate Regulatory Authority (RERA) have already boosted NRI trust by enhancing transparency. However, to maintain affordability for residents, the government may need to explore policy interventions, such as incremental property taxes on multiple holdings (regardless of buyer origin) or incentives that further direct capital towards truly affordable housing projects. The NRI factor is here to stay; balancing its capital strength with social housing needs is the next big challenge for India’s property landscape.
