- greensea
- 06 Feb 2025 11:09 PM
- #Real Estate
Kerala’s Real Estate Market Sees Major Shift as NRIs Look Elsewhere
Declining Interest in Property Investments Among Non-Resident Keralites
For generations, owning a home in Kerala was a cherished goal for non-resident Keralites (NRKs). However, a major shift is underway—second-generation NRKs are now less inclined to invest in real estate, opting instead for more liquid and profitable investment options.
Migration expert S. Irudaya Rajan, chair of the International Institute for Migration and Development, confirms this trend, stating that NRIs no longer see homes and land as viable investment opportunities unless they plan to reside in them.
Key Findings on the Changing Trend
A recent Crisil survey conducted ahead of the Real Estate Conclave (CREC) in Kochi highlights a sharp decline in NRI property investments. Developers note that second-generation NRKs working in West Asia, Europe, the USA, and Canada prefer settling abroad, reducing demand for high-end homes in Kerala.
Why Are NRIs Moving Away from Real Estate?
Changing Priorities: Unlike previous generations, today’s NRIs focus more on investment flexibility and higher returns rather than owning multiple properties.
Vacant Homes on the Rise: Reports indicate that over a million residential buildings in Kerala are vacant due to migration. According to the 2011 Census, around 11.89 lakh homes remained unoccupied.
Family Migration: Data from the Kerala Migration Survey (KMS) 2023 shows that around 4.2 lakh families have migrated permanently, leading many to sell off properties they no longer need.
What’s Next for Kerala’s Real Estate Market?
With NRK investments declining, developers are shifting focus from luxury apartments and villas to more affordable housing options. The traditional real estate boom fueled by remittances is seeing a slowdown, pushing builders to rethink their strategies.
Despite these changes, Kerala still receives substantial remittances—KMS 2023 estimates Rs 2.17 lakh crore in total incoming remittances in 2023. However, with the investment landscape evolving, Kerala’s real estate sector must adapt to new market realities.
The once-booming NRI-driven real estate market in Kerala is experiencing a transformation. With second-generation NRKs preferring global opportunities over property investments back home, the sector must embrace innovation and diversification to remain relevant.
