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I'm an Indian national working in the USA legally. I am thinking about buying an investment property in the US, particularly in the San Francisco Bay area. I see real estate in the bay area doing great, especially rental properties.

However, the other option is to invest in India. Gains in India are greater but the Indian rupee has been sliding against the US dollar. This slide means the real gains are not as attractive, especially if you want to transfer funds back to US.

Gains in the US are really mediocre compared to India (but maybe I don't know where to invest).

I'm looking for a long term investment advice.

closed as primarily opinion-based by Chris W. Rea, Dheer, Nathan L, MD-Tech, keshlam Feb 4 '17 at 21:55

Many good questions generate some degree of opinion based on expert experience, but answers to this question will tend to be almost entirely based on opinions, rather than facts, references, or specific expertise. If this question can be reworded to fit the rules in the help center, please edit the question.

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The gains only matter relative to the currency of the place you wish to live, in absolute terms. If you are living in a different place than you are investing, you also have to worry about currency risk (although the two are related).

So if you plan to live in India, you only care about returns in rupees after inflation. Inflation in India has been running 6%-10%.

Let's say you buy a house in SF for $2 million, about 13 crore in India where you want to live. 10 years from now, you sell it for $3 million, which would have been 20 crore, but inflation and currency decline has eroded it to... 8 crore! In comparison, the house would likely to still be worth the equivalent in 2027 of 13 crore in 2017 rupees.

My point is, investing in the same country you live in gives you a powerful defense against inflation and currency fluctuations.

You might get lucky, of course. Wherever you are might suffer a decline in prices relative to wherever you invest, but keep in mind two maxims:

  • Every pilot knows, takeoffs are optional, but landings are mandatory. You don't have to buy an investment, but if you do, you have to sell it.
  • In investing, you can eat well or you can sleep well. Investing in real estate nearby can help you sleep well.

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