The Global Indian Family Is Buying Abroad for Reasons Beyond Yield

Yudhi Mapara0:00One of the most common mistakes that clients in India make is that they will commit to an overseas property before getting the right advice on the Indian regulatory framework. Now, I've actually got a client who he approached us, he has acquired a property in Dubai, he liked the property and he's committed to buying the property, which is great. He has actually chosen to go to the finance room. He has got the finance promote Dubai lending institution. Now that sounds really good because once that prospect is put in front of you, you think, oh great, I borrowed some 50 or 50%, then the rent that I get will need to cover my mortgage repayment. So effectively I've got a 10 and feet paying off my property.

0:36So yes, great concept and it works really well.

Own the World0:39Welcome to Own the World Podcast with Abhii Dabas. Powered by INTRIC Global.

Abhii Dabas0:58There are roughly 35 million people of Indian origin living outside India. And somewhere in that number is one of the most misread pools of private capital in the world. The assumption is that it flows one way: back home into an apartment in Mumbai or a plot in Gurgaon. That stopped being the whole story a while ago. The Indian family is now buying in Dubai, London, Lisbon, and Singapore. And it is buying for reasons that have very little to do with the yield. Welcome to Own the World, the show for investors who refuse to be limited by geography. I am Abhii Dabas. My guest today spends his working life with those families. Yudhi Mapara is an associate director of private clients at Henley and Partners with more than 23 years of experience across international real estate and global investment markets.

1:44He has advised investors, entrepreneurs, family offices, and private clients throughout Australia, the UK, Southeast Asia, and China on international diversification and cross-border opportunities. Drawing on extensive experience working with globally mobile families, Yudhi specializes in helping high and ultra-high net worth individuals develop long-term strategies that integrate residence and citizenship planning with wealth preservation, business expansion, education planning, succession planning, and global mobility objectives. We are going to talk about what is really driving the global Indian family right now, where the money is going, and the structuring mistakes that cost people years to unwind. Yudhi, welcome to Own the World.

Yudhi Mapara2:26Thank you, Abhii. Pleasure to be here.

Abhii Dabas2:27When someone walks into your office in Mumbai or Delhi today, who are they and what has changed about the person over the last five years?

Yudhi Mapara2:34So typically our clients are the high net worth and ultra high net worth Indians. And uh how things have changed over the last couple of years is that the conversations have become a lot more deliberate. So clients have become more proactive. Earlier clients would come to us when an overseas opportunity arose, but nowadays that's no longer the case. Clients are planning well in advance. They are asking how to create options for their children and diversify where they live and invest.

Abhii Dabas3:00Right. And and the old picture is a successful NRI sending money back to India. How much of that picture is still accurate?

Yudhi Mapara3:07Global Indian is no longer the traditional NRI. Yes. So now the the Global Indian they comprise more entrepreneurs, first generation wealth creators. And these Indians are definitely investing in India, but their outlook has expanded. So they do see global mobility as part of overall succession planning.

Abhii Dabas3:28Yeah, absolutely. Every time I come to India, I just am amazed at the pace of growth. And I'm sure that the number of millionaires in India is growing rapidly as well. How much of this is a founder of first generation well story versus family businesses that have been around for decades?

Yudhi Mapara3:46So this is, I would say, Abhii, this is a uh this is a fairly even split. So we're seeing um interest across all demographics. I can't say that there is a particular demographic that stands out over the other. So to give you an example, uh, we're I'm currently in talks with a few different families. And uh one of the families, they are a large business. Uh they've got an export business which has been, I think this is the third or the fourth generation. And simultaneously, I'm also dealing with a startup founder. He is his company has just gone public for an astronomical amount. He started the company not that long ago. So, yes, we are dealing with clients from all demographics currently.

4:26And it's just amazing how many different I'm just finding out so much more about how wealth is being created. These are avenues that I'm finding out every day, and they're just surprising that how people are just doing so well in India at the moment.

Abhii Dabas4:38Yeah, it's definitely the most exciting place to be, I would say, in the world right now. We work a lot with real estate developers and all the developers that I speak with, they always ask me the same question. How do we target the Indian buyer? Because there's such vibrance in that economy, and definitely the number of millionaires is growing, I think, more rapidly than anywhere in the world. And I'm sure not enough data is available, and otherwise the number would truly be staggering as well. So tell me, Yudhi, what's the age profile for these high net worth and ultra-high net worth clients?

Yudhi Mapara5:12Yes. Uh the the the first generation entrepreneurs, a lot of the tech um ultra-high net worth clients that we deal with typically are under 45. So this is a demographic that we've seen massive growth in uh in India, particularly over the last couple of years. And the way they invest uh or their outlook is somewhat different to the uh traditional ultra-high net worth family owner who was, say, the patriarch was 60 plus. So how that's changed is that the under-45 client thinks in terms of opportunity and growth. Uh, they're a little bit more aggressive in their thinking. Whereas the older patriarch, the uh with the with the with the legacy family business, their thinking is more around wealth preservation and continuing that legacy.

5:57So both the groups ultimately have the have the same goal. They're both seeking financial resilience, but uh their approach is slightly different.

Abhii Dabas6:07Right. And so when a family first comes to you, what do they say they want? I see now young couples uh from India moving to places like Thailand for lifestyle purposes or sometimes even cost of living purposes. And then, of course, you find Indian families in places like Portugal, you'll find people in Australia, and of course, the US has always been a very popular market. So I'm always fascinated by what's truly driving them. So do you feel there's a difference between what clients uh think they want when they first speak to you? And by the time you have your second or third conversation, do you uncover something completely different?

Yudhi Mapara6:46Yes, that is the case. So nowadays, information is everywhere. Social media, you would know, Instagram, uh, Facebook, they're they're buzzing with uh all these ads that say buy a property and secure residency. So when clients first come to us, they want a fairly simple solution. They're like, oh, just help me buy this property and get residency. What's the simplest way to do it? But after the second, third conversation, once we've delved a little bit more, we realize that the real discussion is not just a product discussion. It's more about getting the strategy right for the client to achieve their overall goal.

Abhii Dabas7:22Right. And I mean, knowing Asian families and we interact with a lot of high net worth and ultra high net worth families and family offices, I know that education is always at the heart of every conversation. It is. I'm sure the same applies for Indian families as well. So tell me, uh is the US still the destination most Indian families want to go to, or do you see any new trends developing and do you see some new corridors uh coming up?

Yudhi Mapara7:50Sure. US continues to be the first choice for for most Indian families, particularly those that are looking at for the traditional academic pathways like medicine and law and finance. So that fundamentally hasn't changed. But where the market has evolved is that uh parents and students nowadays are more aware. So they're now asking us where a particular field is taught best. So, for example, we're seeing growing interest in countries like Switzerland for hospitality and hotel management. Italy is popular for those who want a career in fashion and design. And there are other specialized education hubs across Europe that are generating more and more interest. But uh in saying that, uh, the US is still, uh I would say in India, by far the most uh the is the preferred choice.

Abhii Dabas8:37Right. And considering how fast the economy is growing, and India is probably the fastest growing large economy in the world right now. So is there a specific trigger that you see that drives these families to start considering you know overseas destinations for to move or for residency, or is it a combination of factors?

Yudhi Mapara8:58So thankfully, one of the things that we're seeing, Abhii, is that there's not a specific trigger that's that's starting these conversations. Our clients have become less and less reactive. Uh, they've become way more proactive. So uh planning has come into it a lot. When they do come to us, they are seeking sometimes they they're seeking multiple strategies. So they are looking at it more from a planning point of view rather than say their child gets into a university. That's not the time when they approach us. So thankfully, and I think this is the this is the right way to go. So the triggers are becoming fewer and fewer, and it's becoming more about getting the entire strategy right from the start.

9:34Interesting.

Abhii Dabas9:35One of the sort of push factors that we see with clients uh in say Western Europe is usually tax. Would you say for India, tax is also one of the driving factors, or is it not something that people consider?

Yudhi Mapara9:49Tax is certainly a consideration, but uh it's really the first reason you know that the client starts the journey. So education and opportunities for their children is probably number one here in India, followed by business expansion and creating optionality. These conversations are the ones that are leading the way. Tax obviously becomes part of overall structuring, but that is not the sole objective. The other thing also to mention here, Abhii, is that uh tax residency a lot of the times does not apply to our to our clients because a lot of our clients are not looking at leaving India and not looking at spending the requisite amount of time in a tax-friendly jurisdiction. They're happy to continue their business in India or their jobs here in India.

10:31They're looking at this more from an optionality point of view. So for those families or for those clients, tax doesn't come into the into the equation at all because their tax residency will continue to remain India.

Abhii Dabas10:41Very interesting. Yeah, so it's more of a back pocket option and just good to have option and maybe ease of travel and just lifestyle to be to have some presence in multiple jurisdictions. Uh that sounds a lot like you know what I've always tried to do. So I I can uh I can relate to that. Okay, we'll we'll leave uh education at this point because we have another episode coming up with the Henley and Partners team on education. So let's let's uh talk about other things. I want to understand, you know, where the capital is actually moving. So tell me the India to UAE corridor. Now that's been popular for the longest time. I've been seeing that for the last 25 or more years and definitely accelerated over the last uh few years.

11:27What is behind that? And why are Indian families still looking at Lisbon or say the Algarve? And what are they actually buying there?

Yudhi Mapara11:35Clients nowadays are no longer looking at just the one destination to tick all their boxes or to fulfill all their requirements. They're choosing different jurisdictions based on different objectives. So you mentioned Dubai, and that is correct. Uh it is still, it continues to attract Indian families. There are certain, there are quite a few factors. Uh proximity, one of the ones that you mentioned, that's definitely true. There's a sense of familiarity with Dubai as well. Uh everyone here knows someone or the other who is in Dubai, which is not seen as being a huge issue. Culturally, Dubai and India are quite close as well. But uh the ease of doing business is probably one of the reasons uh in the few uh in the recent past that Dubai's become even more popular.

12:16So Dubai has become much more uh than just a tax story currently. It's become business expansion is is generally the prime motive. Portugal has now become a lifestyle destination, but it is part of a broader it's part of broader European planning for Indian families. So that's where Portugal has become the most popular. The investment route, as you know, property now no longer forms part of the Portugal Permanent Residence Program. But the investment route that Indians are very familiar with, they're very comfortable with, they invest in in funds in India in a big way. So the fund investment route is something that Indians are very, very comfortable with. So the property discussion and the residency discussion, they are quite separate, but uh Portugal has become a very big part of the residency story in India, particularly.

Abhii Dabas13:05Right. And and you don't see much has changed even after the five-year threshold has now moved to 10 years. Uh it's still very popular?

Yudhi Mapara13:14It is still popular because um a lot of Indians they're not necessarily looking for another passport. Because in India, you cannot retain your Indian passport and get an additional passport. So the minute you obtain uh a different passport, you have to relinquish your Indian one. So citizenship for a lot of families is not the ultimate goal. It's more about the investment option. And uh because of that, the five to ten years change, yes, that did create a bit of conversation when it happened, but uh we haven't really seen any decline or any change in in the interest in the program itself.

Abhii Dabas13:48Right. And if I remember correctly, Portugal also does not have a very strict minimum stay requirement. I believe it's seven days every year or something. So so it's easier to uh to deal with as well.

14:00Yeah.

Yudhi Mapara14:00Absolutely, yes. I think it's the only program in Europe where you don't have to physically relocate to that country to obtain the passport.

Abhii Dabas14:08Yeah, I think the funds are becoming very popular. We are working with some interesting funds as well, and and I was surprised uh when we were speaking with our Portuguese partners and they mentioned some of their most prolific clients are actually from India. Yes, and and well, that's another story right there. But uh yeah, it seems like Portugal is still uh hugely popular with Indian citizens. So now tell me where does uh property purchase sit in the sequence? Now you mentioned earlier property is a separate decision, it's it's not tied in with the residency decision. So I mean, we obviously manage a lot of real assets. So we always think of what drives uh a buyer, whether it's lifestyle or education or diversification or as we say, you know, doomsday planning or whatever else it might be.

14:57But somewhere people have to decide, you know, where property comes in because they obviously want a place of their own. They want to live, uh, spend some time during the year in in that destination. In your experience, uh, you know, how do families decide on property?

Yudhi Mapara15:13So the in most cases, the residency strategy uh does come first and the property follows. Now, in the case like Portugal, where property that is not a qualifying investment, we are finding the clients are still investing in property, but they're doing it from their own personal point of view, either for personal use or the best investment. But that is separate to the residency decision. Whereas um when clients are looking at, say, a jurisdiction like a Greece or a Malta or a Latvia, where property acquisition is a pathway to residency, the first decision is about choosing the residency strategy, getting that correct. And then the property decision we find it just flows quite naturally from there.

Abhii Dabas15:53Yeah, interesting. And in some cases, savvy investors try to combine all of them, right? So Dubai would give you the residence, it also gives you the high yields, it also gives you the lifestyle and as you said, business opportunities. Nothing competes with the Dubai energy and hustle. You know, we have a team in Dubai and we always talk about that as well. So yeah, some I mean, savvy investors. And I remember you mentioning earlier as well how smart investors can find a way to combine all of these. Let's talk about the mistakes. You know, I always talk about mistakes. I always say I've probably made more investment mistakes, especially cross-border investors investment mistakes than anyone I know.

16:32So, what's the most common mistake that you see? The one that you have watched play out more than once?

Yudhi Mapara16:37Yes. This is uh this is unfortunate, Abhii, but uh one of the one of the most common mistakes that clients from India make is that they will commit to an overseas property before getting the right advice on the Indian regulatory framework. Now, I've actually got a client who he approached us uh probably about three or four weeks ago. Uh he has acquired a property in Dubai and uh he wanted us to help him with his golden visa application, which you know we're obviously glad to do. Uh, but you know, once we delved a little bit further, we realized that uh he has bought the property from a Dubai developer who markets themselves quite heavily in India and he has gone to the exhibition and um he liked the property and he's committed to to buying the property, which is great.

17:19But he has actually chosen to go through the finance route. And he has got fine he has gotten finance from a Dubai lending institution. Now that sounds really good because once that um once that prospect is put in front of you, you think, oh great, I'll borrow, say, 50 or 60 percent, then the rent that I get will easily cover my mortgage repayment. So effectively I've got a tenant who's paying off my property. So, yes, great concept and it works really well, except under FEMA, and FEMA is the Indian Foreign Exchange Management Act, and it's quite strict and it's quite black and white. FEMA does not allow Indian tax residents to borrow from international financial institutions.

18:00So, what this client has done unknowingly is he is now in serious breach of FEMA laws, which is not really a situation that uh I would want to find myself in. And uh we've noticed that he's not a one-off. This is something that is happening quite regularly. So uh that is rather unfortunate.

Abhii Dabas18:19Yeah, I mean, that's why we always talk about education being such an important piece in cross-border investments. You have to understand the regulations, you have to understand everything, not only in terms of say capital controls or how to finance the property, but tax residence, even stamp duty, understand the currency risks as well. And that's something that people don't quite appreciate when they just look at brochures or, like you said, in this case, somebody who just went to a property exhibition and just fell in love with a property. So, yeah, so something to keep in mind. Uh, educate yourself. There are a lot of things to consider. And it's not that complicated, but once you have a clear checklist and if you work with experts, that should be pretty straightforward.

19:00Uh tell me how often does someone come to you after they've already bought? And then how much harder is the problem uh to solve at that point?

Yudhi Mapara19:08Yeah. So a few years ago, it was happening a lot. People were buying first and then coming to us, but that is slowly changing. Unfortunately, it's sometimes it's a bit too slow. And for some clients, it is a little bit too late because if you have executed contracts, if finance has been arranged, what you're trying to do is you're trying to solve a complex compliance issue retrospectively. And that is significantly more difficult.

Abhii Dabas19:33Right. And so if someone's listening right now and they are say about six months away from making this decision, what should they do first?

Yudhi Mapara19:41My advice is fairly straightforward. It's fairly simple. I would say don't start this journey by looking at an investment, a particular investment and the ROI. A lot of um our clients do focus on the ROI. I'd say start by defining your family's long-term objectives. Once you know where you want to be in five, ten years, I think the right residency strategy and the investment decision, those I think they just tend to follow naturally. So the thing to remember remember here is that global mobility is fundamentally about optionality. It's not about relocation, it's not about ROI on the investment. And uh the most successful outcomes are generally reached from planning well before capital is deployed, not after.

20:23Right.

Abhii Dabas20:23That sounds like my life's mantra optionality. Yeah, I can totally relate to that. So tell me now, we talked about Dubai, we talked about Portugal. Do you see any destinations that are becoming increasingly popular with Indian investors and Indian families? And do you see, say, over the next five years, uh places that uh Indian families are moving to or investing in that would surprise people? I mean, people would not normally think about these markets, though Dubai is a no-brainer, everyone understands that. But do you see any interesting, unusual destinations?

Yudhi Mapara20:59I do. I do. So, like you mentioned, Dubai is the no-brainer. Uh, the US also is a no-brainer for reasons we've discussed, and you know, what we've discussed more in our education podcast uh in the future. What has really surprised me is the retirement market in India. So typically you're above 55, uh, empty, empty nester, children have moved out, and now they're no longer happy to just sort of keep staying in their family home. They're looking at options. The Thailand long-term resident visa, particularly under the um uh under the wealthy pensioner category, is getting a lot of interest in India. People are asking about uh places like Mauritius or Malaysia even with close proximity to India, but destinations that are gaining momentum with the retiree market.

21:45So I think that is a shift that I thought was unexpected and I didn't really see it coming. Uh, because uh when we think about uh mobility and uh and and opportunity, we normally associate it with young families and opportunity, but retirees are now increasingly looking at I think they're becoming younger as well. People are retiring in their mid-50s, late 50s, they're still quite active. So they're keen to explore options of where they can live and retire.

Abhii Dabas22:12Very interesting. I would say I'm not surprised because some of the most fascinating conversations I've had over the last 12 to 24 months are about retirement. Because that's the one time that people don't think about deals, they don't think about uh a lot of the practical stuff, and they just finally want to do the things that give them joy. And and and there are so many interesting destinations that I've come across where people just are having conversations about should I move to Japan, should I move to Thailand, like you mentioned. Uh people Bali. Bali, of course. There are things that people have always wanted to do, and they couldn't do it because, say, there weren't enough jobs or they were not enough business opportunities or it wasn't much of an education hub.

22:52And and that's what we find so fascinating at INTRIC, how people can uh move anywhere, and that's why we say own the world, because you know the world is your oyster. So thank you so much, Yudhi, for your time. And uh, if you want to find Yudhi, you can find him on LinkedIn. And of course, as Yudhi mentioned, if you are looking to plan residence or plan uh a passport in another country, then you should work with experts like Yudhi and Henley and Partners. There are some interesting initiatives coming up. INTRIC and Henley and Partners together are coming up with a very interesting report on the global Indian family, something you should look out for.

23:31And it's been a pleasure, Yudhi. Thank you very much.

Yudhi Mapara23:34Thanks, Abhii.

Own the World23:34My pleasure. Thank you for having me. The world's best opportunities do not stop at borders. Subscribe to Own the World. Share this episode, and stay informed on global investing and cross border real estate.