NRI’s Guide to Buy Properties in India
Types of Properties NRIs Can Invest In
Simple Guide for NRIs to Invest in Property in India
Types of Properties NRIs Can Buy
1. Residential Properties
o NRIs can buy residential properties like apartments, villas, bungalows, flats, or farmhouses for personal use or as investments.
o There’s no limit on how many residential properties an NRI can own.
2. Commercial Properties
o NRIs can invest in commercial properties like office spaces, shops, warehouses, or industrial facilities.
o These properties can be used for business or rented out to earn income.
3. Agricultural Land
o NRIs are generally not allowed to buy agricultural land, plantations, or farmhouses.
o Exceptions: If they inherit agricultural land or meet specific criteria set by the Reserve Bank of India (RBI), they may own such properties.
4. Plantation Assets
o NRIs can own plantation properties, like tea or coffee farms, only with prior approval from the RBI.
How NRIs Can Own Property in India
The process for NRIs to purchase property in India is slightly different from that for Indian residents. Here are the key options:
1. Power of Attorney (POA)
o A POA allows someone else to act on your behalf for property transactions.
o NRIs must sign the POA in front of a legal authority, making it a convenient option if they can’t be physically present in India.
2. Joint Ownership
o NRIs can co-own property with others, just like Indian residents.
o All co-owners have equal rights to use, sell, or possess the property.
Document Checklist for NRIs
Documents Needed to Buy Property
· Indian passport or OCI card (if you have a foreign passport).
· Proof of work, such as a visa, job contract, or appointment letter.
· Recent payslips and income tax returns (last six months).
· NRE (Non-Resident External) and NRO (Non-Resident Ordinary) bank account statements (last 12 months).
· Bureau report from your country of residence.
· A POA (if applicable), signed in the bank’s specified format.
Documents to Verify Before Buying Property
· Title deed: Ensure the seller owns the property legally.
· Plan approval and building permit: Ensure the construction is authorized.
· Occupancy certificate: For completed buildings.
· Encumbrance certificate: Confirms the property is free of debt.
· Society NOC: If applicable
Step-by-Step Guide for NRIs
1. Choose a Property Type: Decide whether you want a residential, commercial, or other type of property.
2. Plan Financing: Choose between self-financing or taking a housing loan.
3. Find Trusted Agents or Websites: Work with verified real estate agents or platforms.
4. Research Thoroughly: Look into factors like location, amenities, resale potential, and accessibility.
5. Verify Documents: Ensure the property and seller’s documents are genuine. Seek legal advice if needed.
6. Sign the Sale Agreement: Both parties agree on terms, payment schedule, and possession date.
7. Register the Property: Finalize ownership by registering the property with the sub-registrar’s office.
Tax Rules for NRIs
· NRIs must pay 20% TDS (Tax Deducted at Source) when buying property worth over ₹50 lakhs.
· For properties under ₹50 lakhs, the TDS is 1%.
· NRIs can apply for a reduced tax deduction or exemption.
FAQs
1. How many properties can NRIs buy?
o NRIs can buy unlimited properties, except for agricultural land or plantations.
2. Can NRIs buy property without POA?
o Yes, NRIs can handle the entire process themselves without appointing a POA.
3. Can NRIs buy property without being in India?
o Yes, they can complete the transaction using a POA.
4. Can NRIs own agricultural land?
o Only under specific rules, such as inheritance or RBI approval.
5. Can NRIs get home loans in India?
o Yes, NRIs can apply for home loans, provided they meet the bank’s criteria for income, credit history, and documents.
This guide simplifies the process and ensures a hassle-free experience for NRIs looking to invest in Indian real estate.