The prices of apartments and bungalows in countries like India has risen up so much that it is now cheaper for an Indian to own a home in America instead and still have money. A place like Mumbai or other metro cities like Delhi has becoming too expensive even for upper middle class people and most of them prefer to buy a house in almost highway like areas where the development is still in progress, which means despite lack of grocery stores and other conveniences nearby, people are owning properties far away from the city and would rather travel long distance to job/business place then to buy a home within the major areas in the city. Some of the cities in USA are so affordable due to low cost of living that buying a home in U.S. means spending around 50% money as opposed to spending double the amount to own a home in the country.
One of the key reasons why NRAs (non residential aliens) are buying real properties in U.S. is because of both the affordability and stable market patterns meaning better profit out of selling the same property within 5 years of owning it. As a matter of fact, even developing a home from ground is cheaper comparatively and especially if counties are the target, the returns are significant due to developing economy in these counties. For e.g. there are places in America with barely 50,000 people and investing in that growing economy in that region means lot of potential business opportunities along with buying and selling it. A piece of land owned in a county where agriculture is key economic contributor would mean you can rent the land to the local farmer or a company to produce various crops or start a particular crop production utilizing that land. In return you not only can get the rental income out of it but also commission when said crops are sold if you have such a deal with the farmer or the company.
Even if you do not plan to reside in America for the foreseeable future, you can utilize the home you bought for opening a rental service. Your real estate agent can act on your behalf and manage tenants and provide you the rental income per month. The same agent will responsible for maintaining said property as well as checking background of the tenants residing at your place abroad. In the same way, you can own an apartment and someone can manage it on your behalf to utilize it until you come to USA or sell the property when the price rises. When you consider the fact that in countries like India, spending 50,000,000 Indian Rupees for a duplex is equivalent to $703,700, one can get two homes abroad in U.S. and still save some money after all the costs are conclude. In fact a foreign investor can easily obtain finance from the private lender and own a home with around 30% down payment, meaning even more savings and better income flow till the property is paid for. Different types of properties can be bought and utilized at affordable rates in America as opposed to buying a home in a country like India or Germany or Russia. On top of all that, a good realtor can also save you a lot of tax related expenses so even when all the costs, such as closing costs, tax, mortgage payments etc. are considered, it will still be a cheaper purchase considerably by a large margin instead of investing or buying a property in expensive countries.
1. US real estate is slowly emerging as long-term investment for investors based in India. There is a slow and steady appreciation in the real estate market in U.S. Buying a property in U.S. not only get you an Asset in a foreign country, it is also denominated in U.S. dollars, which is still the currency of choice around the globe.
2. Inflation rate in India are higher than as compared to U.S., this gives a positive rate of return.
3. Infrastructure in U.S. are far better (rail, road, bridges etc) compared to India or any other country which makes it a popular destination to Invest.
4. You can expect a 4-5% return on rentals in properties in U.S. as compared to 1-2% returns in rentals in India due to inflated property prices.
Key reasons for increasing demand for the U.S. real estate includes increasing demand for U.S. residential properties and low prices with regular income and lesser risk due to portfolio diversification.