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NRI Corner

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India is at a crossroads of change. The developing situation across the world has highlighted India as one of the preferred destinations for commerce and industry. Weaker Indian rupee makes Real Estate an enticing buy. Thus, transforming India into a land of opportunities.

An NRI or a Non-Resident Indian can buy property in India with complete ease. Thanks to the implementation of RERA Act, 2016, the process has become much simpler, transparent with committed timelines.

Documents needed by NRIs to buy the property

  • Valid passport
  • Address proof
  • Permanent Account Number (PAN card)
  • A recent photograph

Payment & Repayment

There are multiple channels for NRIs to pay for the property they intend to buy.

  • If they have the sufficient funds, then payment can be done easily. They can do so by remitting the money through authorized banking channels from abroad. They can also use money in their NRE/NRO or FCNR accounts for the payment.
  • If NRIs require a loan to pay for the property, then RBI has now granted permission to banks and housing finance institutions that are registered with the National Housing Bank to provide home loans for NRIs to buy residential property in India.
  • All transactions have to be made in Indian currency. NRIs cannot avail the loan into their accounts directly. It will be disbursed to either the seller’s or the developer’s bank account.
  • There is a provision of repayment of loan using the funds in an NRI’s NRO (Non-Residential Ordinary) /NRE (Non-Resident External) account or FCNR (Fixed Deposit Foreign Currency account) deposits.
  • Traveler’s cheques or foreign currency is not an acceptable means of payment.

Joint ownership of the property in India

An NRI can buy the property of their choice in their own name or jointly with any other NRI. The property cannot be in joint ownership with a resident Indian or with those who are otherwise not allowed to buy property in India.

Power of Attorney

Power of Attorney (POA) is the person selected by the NRI, who is investing in a property in India to complete the transaction on their behalf. It could be anyone from a trusted relative, friend or even colleague.

A POA can be attained by going down to the Indian Embassy of the city and country where you are located and sign the document in front of the consulate officer.

Documents needed by NRIs to buy the property

  • A photograph
  • Your left thumb impression
  • Signature
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Frequently Asked Questions

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As per India's Foreign Exchange Management Act (FEMA) 1999, an NRI or Non-Resident Indian is a citizen of India, or a foreign national of Indian-origin, living outside India for employment, business or any other vocation, which would indicate his intention to stay outside India for an indefinite period. An Indian would also be termed as an NRI if his stay in India less than 182 days during the previous financial year (April-March).

A PIO is an individual (not a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan) who has at any time held an Indian passport. Or, one whose either/both parent/s or grandparents were citizens of India, according to the Indian Constitution or the Citizenship Act, 1955.

As per India's Foreign Exchange Management Act (FEMA) 1999, a person resident in India is a person residing in India for more than 182 days during the previous financial year (April-March) and who has come to, or stays in India either for employment, business or for any other vocation.

Yes, a foreign national who is a person resident in India can purchase immovable property in India but only after obtaining the approvals and fulfilling the requirements.

  • Can the property be hold by NRIs even after becoming an OCI card holder?

    Yes, a person who had bought residential/commercial property/agricultural land/ plantation property/farm house in India when they were an Indian citizen, can continue to hold that property without the approval of the Reserve Bank after becoming an OCI card holder.

  • Can they gift such properties?

    Yes, they can. Transfer residential or commercial property in India by gifting it to a person resident in India or to a person resident outside India and is a citizen of India or to an OCI card holder resident outside India.

  • Can the property be rented?

    Yes, OCI card holders can rent out their properties in India. For more information on this matter, please follow the link: https://www.rbi.org.in/scripts/FAQView.aspx?Id=33#F2

No. A foreign national of non-Indian origin, resident outside India cannot purchase any immovable property in India unless such property is acquired by way of inheritance from a person who was resident in India.

He/she can acquire or transfer immovable property in India, on lease, not exceeding five years. In such cases, there is no requirement of taking any permission of/ or reporting to the Reserve Bank of India.

  • The repatriation of sale can be done for maximum of 2 properties, only in case when the purchase was made through an NRE account, not otherwise.
  • The amount repatriated should be equal to what you have paid for the acquisition of the immovable property in the foreign exchange received through normal banking channels, or from the funds held in FCNR or NRE Account.

Yes. A Foreign National of non-Indian origin, including a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan, can acquire residential properties on lease in India. If the lease is not exceeding five years, he/she does not require any prior permission from the RBI.

Yes.

  • A flat, apartment, villa or a plot are the properties in which an NRI is eligible to apply for home loans
  • For construction of a property on a plot of land by self
  • To purchase a plot allotted by a society/development authority
  • To renovate or improve upon an existing property in India

The eligibility is calculated in the same way as it is done for resident Indians with special emphasis on:

  • Qualifications - Graduate (minimum)
  • Current job-profile and work experience
  • Chances of continuing working abroad for the duration of the loan’s tenure
  • Chances of servicing the loan with an extended tenure, in case the applicant needs to return to India

Documents required by NRIs are:

  • Passport
  • Proof of their works contract or the labor card
  • POA – in case NRI won’t use the property directly

No tax benefits are available for NRI's, unless NRIs file the returns and becomes eligible to avail the benefits.

  • The housing loan needs to be paid upfront for the entire tenure of the loan, by way of direct remittances from abroad through normal banking channels, or from other financial accounts as may be permitted by RBI
  • Generally, payments are done through NRO, NRE, NRNR and FCNR accounts. These allowed accounts may change as per RBI regulations

Home loan for NRIs do not exceed 5 years in major cases. However, some financial institutions offer loans for a term of 7 years as well.