Gulf-Based NRIs Shifting Away from Indian Real Estate Towards Equities
Mumbai, May 2026 — A notable shift is underway among Non-Resident Indians (NRIs) based in the Gulf Cooperation Council (GCC) countries. According to a fresh survey by Equirus Wealth, many are reallocating investments from Indian real estate to equities and other liquid financial assets.
The April 2026 survey, covering over 8,300 GCC-based NRI clients, reveals clear trends:
- 73% of respondents are increasing their exposure to Indian equities and mutual funds.
- 40% are actively reducing their allocation to Indian real estate — the highest negative sentiment recorded across any asset class.
- Only 13% plan to increase real estate exposure in the near term.
Fresh capital deployment strongly favours equities, preferred by 42% of participants, while real estate sees broad-based exits. This marks a structural move from illiquid physical assets toward more organised and liquid financial products.
Changing Purpose of Remittances and Investments
The survey also highlights evolving priorities among Gulf NRIs. Investment and retirement planning now rival traditional family support as key reasons for remittances and capital flows. Investment accounts for 27%, retirement planning for 22%, and family maintenance for 26%. This reflects greater financial sophistication and long-term planning among the diaspora.
Key Drivers Behind the Shift
Several factors are influencing this reallocation:
- Geopolitical Uncertainty: Tensions in West Asia, including regional conflicts and airspace restrictions, remain a top concern for 41% of respondents. In such an environment, many prefer to preserve liquidity and increase savings rather than commit to large, illiquid investments like property.
- Liquidity and Returns: Indian equities have delivered strong performance, offering easier entry and exit compared to real estate. Property investments often involve maintenance costs, regulatory complexities, tenant issues, and relatively modest net rental yields (typically 2-3% after expenses).
- Portfolio Optimisation: Many sophisticated investors view this as a diversification strategy within their India exposure, moving away from physical assets that can be harder to manage from overseas.
Individual accounts from Dubai-based NRIs echo these sentiments, with some citing low yields and operational hassles as reasons to pause new purchases or even consider exits.
Not a Complete Pullback
Despite the shift, overall NRI investments in Indian real estate remained strong through 2024 and early 2025. NRIs accounted for roughly 18-20% of property purchases in major markets, contributing an estimated $14-15 billion in 2024, with projections exceeding $16 billion for 2025. Gulf NRIs have historically been major players, attracted by currency advantages, appreciation potential, and emotional connections to India.
Demand has been particularly visible in cities such as Mumbai, Bengaluru, Pune, Hyderabad, and select Tier-2 locations. Domestic buyers and NRIs from the US, UK, and other regions continue to provide resilience to the market.
Outlook
The current reallocation among Gulf-based NRIs could exert short-term pressure on premium and luxury segments, especially if regional tensions persist. However, India’s long-term growth drivers — including infrastructure development, urbanisation, and economic expansion — maintain the country’s appeal for many investors.
This trend represents portfolio optimisation rather than a wholesale abandonment of Indian real estate. Future shifts will likely depend on geopolitical stability, equity market performance, and policy measures such as simplified repatriation rules.
For individual investors, the message is clear: diversification and liquidity management are taking centre stage amid uncertainty. As always, those considering investments should consult professional financial advisors for personalised guidance.
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