Realtors eye windfall as rupee dips

India's property market may attract $3 billion (Dh11.01 billion) from overseas as the rupee's slide to a record and a decline in prices make assets attractive to foreign funds and Indians living abroad, according to Jones Lang LaSalle. Total investment for the financial year ending March 2013 is estimated at $4 billion, including $1 billion by local buyers, Shobhit Agarwal, joint managing director at the Indian unit of the world's second-biggest publicly traded commercial-property broker, said in an interview. The rupee, which has slid 15.6 per cent in 2011, may extend losses, while prices may fall 10 per cent as growth slows in Asia's third-biggest economy, he said. "They get a net 30 per cent discount, so they will be ready to write the cheque," Agarwal said. "Non-resident Indians will buy at this price point." The Indian currency is the worst performer in Asia this year as the widest current-account deficit among the major economies in the region spurred outflows amid concerns the European debt crisis is deepening. The rupee touched a record low of 54.305 against the dollar on December 15 after government data showed industrial production shrank in October for the first time in more than two years. Property sales have slumped in India's biggest cities as the Reserve Bank of India raised borrowing costs 13 times by 3.75 per centage points since March 2010 to cool inflation. Central bank Governor Duvvuri Subbarao refrained from increasing the benchmark repurchase rate on December 16 for the first time in eight meetings and said December 22 that the pace of growth this financial year may be slower than an estimated 7.6 per cent. "A lot of capital is required as liquidity is tight because of high interest rates, a lack of bank lending and lower sales," Agarwal said. Money will be available, though the cost of capital is likely to remain high, Agarwal said. Interest costs will likely remain close to their peak of between 18 per cent and 22 per cent, he said.