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Over the years, NRI investment in Indian real estate has been increasing. A number of reputed developers have come up with quality homes in key cities that are aimed to meet the needs of NRIs. These luxury homes cater to their requirements for housing and they are keen on acquiring these properties. The Indian government has also come up with several tax norms to make the reality sector friendly to the NRI’s. If you are an NRI, and looking forward to invest in the real estate sector in India, here are certain things you should keep in mind.
First of all, you would want to know if you can invest in the real estate industry in India. The answer is yes, and the next thing you would want to know is the norms that you need to comply with, when you make the purchase. Well, NRI’s should have a valid Indian passport in order to invest in the real estate sector. However, certain restrictions have been implemented on the investors. If you are a citizen of some of the neighbouring countries of India, like Bangladesh, Pakistan, Sri Lanka, Nepal, Bhutan, Afghanistan, China, Nepal, or Iran, you will require a prior approval. For citizens from any other country, no prior approval is necessary.
These citizens can invest as much as they want on residential and commercial properties. However, their investment should be limited to these properties only, and they cannot invest on agricultural land. Besides, if you are an NRI, you will not be allowed to buy farmhouses or plantation properties. However, if these properties are gifted to you, you can inherit the same. The transaction has to be made in the Indian currency and the amount has to be transferred through the regular banking channels through the NRI account. The NRI’s have the freedom to get home loans, just like the Indian citizens. The loan amount is generally 80% of the value of the property. No rule for immovable property has been implemented by RBI, in case it is gifted or inherited.
The NRI’s can also rent off and lease out these properties without any restriction. If you are willing to rent off these properties, make sure to get across to a reputed lawyer to get all the documents. You would not like to land up in legal hassles while making these transactions. You must verify the original title deed documents to ensure that the property is in the name of the seller. Besides, you should carry out a research to make sure that all the dues related to the property have been cleared off by the seller. It is also important to check that the right to transfer the property to a buyer has not been diluted by the seller. You need to cross-check, if the property has been constructed on an agricultural land, without the necessary consent of the government.
The demand for residential and commercial property in India is high. The returns on selling these properties are very high. You can invest in these properties now and get high returns in selling or renting off these properties. Leasing out the commercial spaces also remains a promising option for NRI’s.
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