NRI: Real Estate vs Stocks — Where to Invest Your India Money

The Nifty 50 index has delivered approximately 13–14% CAGR in INR terms over the past 20 years (2005–2025). Indian residential real estate in major cities has returned roughly 6–8% CAGR in capital appreciation, plus 2–3% rental yield, for a total return of 8–11%. However, real estate returns vary enormously by location — Mumbai's prime areas have outperformed; Tier-2 cities have underperformed.

Indian stocks via a PIS/demat account are highly liquid: you can sell and repatriate funds (from an NRE account) within a few days. Real estate typically takes 3–12 months to sell, involves significant transaction costs (registration, stamp duty, brokerage), and — if rented — requires property management that's particularly challenging to handle from abroad.

Listed equity held for more than 12 months: LTCG at 12.5% (above ₹1.25 lakh/year exemption). Property held for more than 24 months: LTCG at 12.5% (Budget 2024 — indexation removed). TDS on property sale: buyer must deduct 20% TDS from the payment and deposit with the government; as a seller NRI, you'll need to apply for a lower TDS certificate if the actual gain is substantially less than 20% of gross proceeds.