is surprisingly frank. 'Even I could get robbed in a property
deal in Goa if I was not careful,' he admits.
Considering he is from Goa, it does not
sound like much of an advert for the Indian property project
he runs for the Birmingham-based Claremont Group.
But D'Costa is just being brutally honest.
The Indian property market is notoriously corrupt and property
law is infamously bureaucratic. But then there are the palm
trees, long white beaches -and the fact that for as little
as £25,000 you can buy a permanent home in this holiday
Goa, on the west coast of India, has been
the destination for foreign fun-seekers for at least 40
years. The hippies of the Six- ties headed there for sun,
sand, sex and drugs.
These days the region has become the destination
for newly rich eastern Europeans, many of them looking for
much the same thing. Locals are concerned that land is being
snapped up by the Russian mafia and no visitor to Goa can
miss the huge number of Russian visitors throwing money
The worries among the authorities about
unwelcome foreigners means they are keen on finding those
who have not followed the rules to the letter. Britons seeking
property are advised to take as much independent legal advice
as possible before buying.
But India is increasingly being touted
as the new property opportunity for more sober investors.
And it is not just Goa. There are also city apartments in
Mumbai for business bosses.
And what about in Himachal Pradesh? According
to London estates agents Savills owning a ski chalet in
the Himalayas could be the next big thing.
Residential property prices in Goa have
jumped by 30 per cent in the past year and with the Indian
economy still booming, investors could easily be led into
believing that it is a no-risk investment. Goa has two million
visitors a year, three-quarters of them Indians. There can
be little doubt that Goa is fast becoming India’s
The Claremont Group has a long pedigree
of UK property development. Founded by Manjit Deol and his
sister Prem Saini in 1999, it has most famously bought (and
quickly resold) £25 million of flats in Birmingham's
Over the years the group has built up a
client base of 1,400 buy-to-let investors in the £125,000
to 175,000 range. They hope to repeat the process in Goa.
Deol says: “Property prices in Goa
have risen 30 per cent in the past year and the forecasts
are for another 20 per cent a year for the next three years.”
There is a real demand from abroad - £6.6 billion
of foreign money has been invested in real estate in India
in the past four years.
The Claremont project is still a rock-strewn
field, albeit a spectacular one on the top of cliffs that
drop away to white sands and blue sea. There will be 500
villas and apartments. It is a touch upmarket from some
projects so prices start from £37, 000 for a one-bedroom
flat to about £25.000, for a four-bedroom villa.
At the heart of the site will be a five-star
hotel. Top groups, including the Marriott, are said to be
considering becoming involved. Deol has already sold 120
villas. They will not even start work until December and
the scheme and the scheme will be completed in January 2010.
Deol and Saini have two other sites in Goa under way and
are looking at locations farther south in the beautiful
state of Kerala.
It all seems perfect, but as D'Costa says,
the issues are tortuous. For a start, it is illegal for
a foreigner to own property in India.
This may seem like a major obstacle to
would-be buy-to-let investors, but Claremont, like many
other companies, plans to offer off-the-shelf schemes for
investors to bypass the notorious India bureaucracy. The
entirely legitimate solution is to set up a company in India
that owns the property - foreigners are not barred from
The company then collects rents from holiday
tenants and from these it pays out a dividend to the one
shareholder - the owner.
While foreigners selling a property in
India would not be allowed to take the cash out of the country,
they can take out the cash when they sell their 'company'.
Claremont plans to offer a completely managed. In theory,
buyers need never visit or see their property, but can simply
buy as an investment, taking the dividend and selling when
Of course, they can also use it as a holiday
home -London to Goa is only a 12-hour journey, including
British estate agents have realised this
and most of the leading names have established offices in
India. Savills is one of the later entrants, but after a
roadshow across the nation last month, it is feeling bullish.
Chantel Halai, head of Savills' India desk
in London, found both newly rich Indians keen to buy in
London and opportunities in India for London-based buyers.
Her parents came from Gujarat in North-West
India, but she admits that she is a foreigner there when
it comes to business. It is a view echoed by Deol, whose
parents came from Punjab. 'I am not Indian enough to do
business well there,' he says.
Halai has some clients from India who want
to buy property in London. 'I am working for someone in
the film industry who wants to purchase a central London
property for 1 about £1.5 million, she says.
The other business prospect for Savills
is selling Indian property to Britons. Savills, which is
not connected to Claremont, is looking at a rival development
in north Goa, close to the state capital Panaji.
Halai agrees that the private company route
is a realistic way for Britons to own a flat or house in
D'Costa says two or three people visit
the Claremont development site every week. 'We had one British
woman of Indian origin and she brought all her cousins and
extended family with her and they bought 20 units,' he says.
Savills also plans a luxury apartment block
in Mumbai. Aimed at executives looking for a base in India's
financial capital, the site will have properties ranging
in price from £700,000 to £1.5 million. Even
by British standards, this is far from cheap, but the biggest
will be as much as 10,000 square feet, far more than such
a sum would buy in London.
But the real ace up Savills' sleeve is
in the northern state of Himachal Pradesh, where a ski resort
is under construction. It is early days, but Halai is convinced
that skiing in the Himalayas will soon become a major draw
for people tired of the overcrowded and expensive ski slopes
in Europe and America.
Rich Europeans on skiing holidays in India?
That would mean the country has arrived as a global property