With the drop of home prices in many of the top cities, foreign investors now plan to invest in commercial properties in India.
Foreign investors are active in the country since 2005 the year in which they were permitted. However their main investment options remained residential market due to simpler investment norms. Moreover, once the home is finished, the housing sector offered them chances to exit easily with higher returns.
However with surging number of unsold homes in the country, the foreign investors plan to shift to commercial sector now. It is true that the residential market in India is not as vibrant as it was earlier. This would be a reason what prompts them to exit from the housing sector.
Foreign investors including Blackstone Group, now plans to the move on to the commercial sector for their investment, reported Reuters. The sluggish residential is shown as the reason for their shifted interest.
Though the foreign investors are keen to invest in India due to its fast-growing economy, they do not find investment in the residential project as suitable as it was. Home prices have fallen by 5 to 30% since 2009. This fall of home prices prompts foreign investors to look out for other options. Continue reading