India Investment: Economy
Top of property investment considerations in India is the country's economy. With a GDP of US$1.25 trillion, India is the 3rd largest country globally in terms of purchasing power parity. Strong economic growth of between 8% and 9%, rising foreign exchange reserves, a booming capital market and rapidly expanding foreign direct investment inflows, place India's real estate at the base of an upward growth curve.
India has a large, well-educated, english-speaking workforce and is set to become a major exporter of software services and information technology workers. Inflation in India remains high as a result of easy consumer credit and an India real estate boom in recent years. High inflation is perhaps a negative economic factor, and may also be for property investment in India.
India Investment: Tourism Potential
Tourism is also an important consideration for property investment. India is streamlining visa provisions for foreign tourists to boost visitor numbers. India's tourism industry is expected to attract 5 million visitors in 2008. India travel and tourism accounted for 6.1% of India's GDP, increasing the demand for rental accommodation and the potential for property investment in India.
Tourism in India is set to grow by an average of 7.6% year-on-year to 2018, according to the World Travel & Tourism Council. India's tourism infrastructure is earmarked for substantial investment over the next few years. Once this is done, tourism will grow still further and enhance potential for investment property in India.
India Investment: Property Prices
Demand for real estate in India is increasing due to pressure from India's domestic real estate market. India's city of Mumbai has become one of the most expensive cities in the world in terms of property prices and the prices of high-end residential properties in major cities saw a 20% to 25% increase in Q3 2008.
Although India imposes restrictions on the purchase of property by non-residents, foreign companies are actively encouraged to participate in the construction and development of India's real estate. This measure is to satisfy the huge housing shortfall in India's domestic market.
