Indian property: Right time for UAE, Gulf NRIs to be buying a home?

Dubai: For Indian expats in the UAE and Gulf, now could be the right time to consider a property investment in India, with major cities starting to show signs of slower price growth.

This is probably the first time that value gains are showing such signs in the last 3 years, when high demand from domestic buyers meant that NRIs were competing for the same properties or locations. Even in the first three months of 2025, property values in major cities had grown by 10%-30% from a year ago.

Now, there are more signs that apart from prices, demand from resident Indian buyers too seem to be sliding. This week, the consultancy Anarock confirmed that unsold luxury homes valued at Rs25 million in Mumbai totaled 8,420 units as of end Q1-2025.

And this trend is taking on pan-Indian proportions. “Around 93,280 homes were sold across the Top 7 Indian cities in Q1-2025, against over 130,000 in Q1-24,” said Morgan Owen, Managing Director for Middle East and North Africa at Anarock Group. “This clearly indicates a slower absorption trend driven equally by increased prices and geopolitical headwinds.”

For many Indian expats in the UAE these days it’s a decision based on whether it makes better sense to buy a home here or opt for an investment in India.

“More than ever, Gulf’s NRI buyers are worried whether it makes any sense to buy or build a costly home in India and have it rented out or kept vacant,” said a property advisor. “A NRI in the UAE could well use those available funds to buy a home here, whether to rent or use for the family.

“There are clear signs that Indian cities are having to compete for the Gulf NRIs’ dollar when it comes to property investments.”

Based on what many Indian expats in the UAE have been saying, these days a new property buy is based on whether their kids are going for higher studies in India - or not.

According to Azaz Motiwala, founder of Ikon Marketing Consultants, property price growth has ‘cooled’ to single digit levels in most major cities. “Bengaluru and Hyderabad still made 5% gains, but that’s well below the double‑digit jumps of prior years,” said Motiwala.

“Several cities - including Mumbai, Pune, Hyderabad, Chennai, and Delhi-NCR - are now facing a genuine crunch in entry-level inventory. This supply tightening is most evident in the affordable and mid. segments, where steady demand is not being matched by fresh launches.”

Again, if NRIs in the UAE and Gulf are looking to make some ‘strategic’ property buys in India, now could be the time for that.

Another favorable outcome from recent months is the start of the interest rate cuts, which is also reflected in mortgage offers.  

“Leading banks in India have reduced their lending rates by 5–10 bps in May 2025 (from the peaks in mid-2024),” said Owen. “However, loan demand is not linked solely to interest rates – overall sentiment, which is significantly influenced by the geopolitical environment, also play a big role.

“Also, a big chunk of sales is currently happening in luxury and ultra-luxury housing – segments where buyers are far less dependent on home loans. Many NRIs are majorly focusing on these segments.

“Driven by steady demand, luxury and ultra-luxury homes - priced from Rs15  million - dominated new supply in Q1-25 with a 42% share.”