Real Estate Investment? HNIs Become Cautious Ever

High net- worth individuals (HNIs) have excess money. Yet they find no proper place to invest it as the real estate market fails to give them higher returns. For them real estate investment has become unsafe.
Real estate investment

Real estate investment? HNIs turns highly cautious about their investment on real estate properties .

High net- worth individuals (HNIs) always look for income generating assets. They are least bothered about the fluctuations in the economy. High net- worth individuals’ (HNIs) real estate investment was always well- known. As any others they also preferred real estate investment to all other forms of investment. Continue reading

Realty Funds gets Cold Shoulder from HNIs

Realty has historically been a favourite of HNIs, who have invested even in tough times.

But the dismal performance of most players, not-so-attractive returns on offer and an opportunity to tap the market directly are keeping HNIs away from the real estate funds, which are trawling the money market for investors.

Now, Real estate funds are finding it difficult to raise fresh funds as their mainstay investors, the high net worth individuals (HNIs), are turning their back on them.

Sutapa Banerjee, senior vice-president and head (private banking, India), ABN Amro Bank said that, “The interest in real estate has not dried up. Property continues to be a significant part of an HNI’s portfolio.” In addition, there seems to be some discomfort with funds investing in realty.

During the first major fundraising in 2006-07, funds were highly optimistic on the sector. But after the crash in 2008-09, exit with decent returns became a major issue for them.

An HNI advisor, Jayant Pai said, “Investors generally have a recent bias and the recent happening isn’t very good. The existing funds have promised good returns, but they are still on paper; these exits have not come through. A good amount of funds have extended their exit time period, this affects the internal rate of return.”

Buyers Investing Again in Residential Properties

Goa Real Estate Properties - Sapana Palmeiras 1

May 04, 2010

Investors have made a return to realty. Long term capitalization and an expected rise in this sector are the two major reasons for this come back.

However, the present investments are not as good as they used to be before recession period.

The Chief Financial officer of Mantri Developers, Anil Kumar said that currently there is a considerable amount of investment and it is expected to increase in future.

He also added that the realty cost which went through a sharp correction during the recession now has a large scope for capital appreciation in future.

In India, the usual investors in the residential properties are the Non-Resident Indians (NRIs), High Net worth individuals (HNIs), domestic investors and professionals with large disposable incomes.

However, the view of analysts is different.

According to them, although the investments are higher than they used to be at the time of recession, but the uptake is not encouraging due to the recent increase in price by developers.