Factors NRIs Should Keep in Mind before Purchasing Property in India

Lately, Indian real estate has been gaining popularity among NRI (Non Resident Indian) property investors and buyers. The trend of NRIs purchasing properties in India has grown especially after a number of reforms and the establishment of RERA, which helped to increase transparency in the real estate sector. However, there are a few things which NRIs tend to get confused about when buying properties in India. Here is a look at some of the things that they should become familiar with before taking the final decision.

Who can purchase?

Any NRI can buy a property in India as long as they hold an Indian passport. In case they have a foreign passport, it is essential to have an OCI (Overseas Citizen of India) card. A foreign national married to an NRI can jointly own one immovable property with his/her spouse. However, the citizens of Pakistan, China, Bhutan, Bangladesh, Nepal, Iran, Macau, Hong Kong, Democratic People’s Republic of Korea, Afghanistan and Sri Lanka cannot buy a property in India without RBI’s permission.

Can NRIs inherit property?

NRIs can inherit any property in India, including farmlands and agricultural land on which purchases are otherwise restricted for them. An NRI can inherit properties from another NRI or OCC (Overseas Indian Cardholder). An NRI is also allowed to freely give away properties in India to resident Indians as well as other NRIs and OCCs, except citizens of the 11 countries mentioned earlier.

What kind of properties can NRIs buy?

Any immovable property in India except plantations, farmhouses and agricultural land can be purchased by NRIs. They can purchase residential as well as commercial properties, but the money used in the process should be held in a non-resident account. However, if they buy the property through a foreign firm in India, they would face restrictions. A company which has been established in India in accordance with FEMA can buy only the property which is absolutely necessary in order to carry on business. Therefore, an NRI cannot purchase a property through a company for personal purposes.

Can NRIs approach RERA in case of disputes?

Just like resident Indian property owners, NRIs can approach RERA and even the Indian courts in case of property disputes. They can also reach out to the consumer fora of different states for solving disputes.

Is Indian real estate safe for NRIs to invest?

After the establishment of RERA, Indian real estate has undergone several changes. Earlier, developers used to covertly make changes to contracts forcing buyers to end up paying more than the amount agreed upon. However, now due to oversight of RERA, developers have to stick to their promises, making it a safe field for investment.