How can an NRI buy a property in India?

Wondering about

NRI property buying in India

. Non-Resident Indians (NRIs) have the option to invest in real estate in India, subject to certain regulations and procedures. 

What is the Step-By-Step Guide on NRI Purchasing Property in India?

These are some of the steps to assist you with how can NRI buy property in India;

• NRIs are eligible to buy residential and commercial properties in India, except for agricultural land, plantation property, and farmhouse properties.

• They need to provide specific documents such as their passport, visa, and proof of Indian origin or Overseas Citizen of India (OCI) card for property transactions.

• NRIs can fund property purchases in India using funds from their Non-Resident External (NRE) account, Non-Resident Ordinary (NRO) account, or Foreign Currency Non-Resident (FCNR) account.

• They can also avail of home loans from Indian financial institutions, subject to the lender's terms and conditions.

• If an NRI cannot be physically present in India to complete the property transaction, they can appoint a trusted representative through a Power of Attorney (POA).

• The POA allows the appointed individual to act on behalf of the NRI in signing documents, completing legal formalities, and representing them during the property purchase process.

• NRIs need to be aware of the tax implications associated with property ownership in India. They are liable to pay property taxes, stamp duty, and capital gains tax (if applicable) on the sale of the property. Additionally, rental income earned from the property is also subject to taxation in India.

• NRIs should ensure compliance with the regulations set by the Reserve Bank of India (RBI) and the Foreign Exchange Management Act (FEMA) regarding property transactions by NRIs.

• It's advisable to seek guidance from legal professionals or real estate advisors familiar with NRI property investments to navigate the legal requirements effectively.

• Once the property purchase agreement is finalized, NRIs need to ensure proper registration of the property with the relevant authorities as per the laws of the respective Indian state where the property is located.

This is all about NRI property buying in India

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My cousin is an NRI. He desires to purchase real estate in India. He then inquired about the purchase of property from NRI in India. I do have an understanding of the procedure because I bought a property last year after moving to India from the United States.

RBI Guidelines for NRI Buying Property in India

I have followed the process mentioned by Nihal Shaw above to buy a property in India. To guarantee easy and transparent transactions, the Reserve Bank of India (RBI) has released rules for non-resident Indians (NRIs) purchasing property in India. The objectives of these rules are to protect the interests of Indian sellers and NRI buyers while streamlining the procedure. 

• NRIs do not need to obtain any specific approvals in order to purchase residential or commercial properties in India, as per the standards.

• Regardless of the residency status, citizens of the Democratic People's Republic of Korea (DPRK), Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan, Macau, Hong Kong, or Macau cannot purchase or transfer real estate in India without the Reserve Bank's prior approval, with the exception of short-term leases of no more than five years. An OCI will not be subject to this limitation.

• Immovable property can be purchased in India by foreign nationals of non-Indian origin who are residents of the country (except from the 11 nations mentioned above).

• Foreign individuals of non-Indian background who live abroad are permitted to purchase or transfer real estate in India for a maximum of a five-year lease, or they may inherit real estate in India from a resident.

Moreover, you can check more guidelines for purchasing property from NRI in India

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I hope you got your answer that NRI can buy land in India.

If you have an NRI relative, you must surely have come across the question, “can NRI buy land in India or not?” I have many relatives who are NRIs and they keep coming up with this question. All I say to them is that the option of investing in Indian real estate is available to non-resident Indians (NRIs). Although buying a home in India is a very simple procedure for NRIs, there are some significant considerations if you are wondering can NRI buy property in India without visiting. I will tell you the process in detail. 

How NRI can purchase property in India?

1. Make sure you're eligible: Verifying your eligibility is crucial before starting the process of buying a home in India. People of Indian Origin (PIOs) and NRIs are both allowed to invest in Indian real estate. However, before investing in real estate in India, nationals of several nations might need approval from the Central Bank of India (RBI). It is advised that you speak with a legal professional to ascertain your eligibility.

2. Get a PAN card: Before buying real estate in India, NRIs must have a Permanent Account Number (PAN) card. The PAN card, which is used for tax-related purposes, is a special 10-digit alphanumeric code issued by the Indian Income Tax Department.

3. Establish a bank account: To conduct financial activities relating to the purchase of property, NRIs must open a Non-Resident External (NRE) or Non-Resident Ordinary (NRO) bank account in India.

4. Employ a lawyer: To make sure that the entire process of buying a property in India is simple and hassle-free, it is essential to choose a reputable lawyer. Your solicitor will guide you through the legal formalities, including the creation of the required paperwork and the confirmation of the ownership of the property.

5. Do due diligence: Before buying a home, it is crucial to perform careful due diligence. This entails confirming the ownership of the property, looking for encumbrances, and making sure that all required clearances and approvals have been received.

6. Close the deal: After due diligence is finished, the buyer and seller can close the deal. The contract should specify information like the property's description, cost, terms of payment, and any other pertinent terms and conditions.

7. Make a payment: With an NRE or NRO bank account, NRIs may pay for the property. You have the option of paying with a check or an electronic transfer.

8. Register the property: Registering the property in the buyer's name is the last step. This entails paying stamp duty and registration fees, as well as delivering the necessary paperwork to the neighbourhood registrar's office.

NRI buying house in India: Types of Properties NRIs can buy

Now that you know the answer to the question, “can NRI buy house in India?”, I will tell you the types of properties an NRI can invest in. An NRI is permitted to purchase real estate in India, according to the Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Rules, 2018. You can purchase a variety of commercial and residential properties as an NRI, with the exception of those used for agricultural purposes, such as farms, plantations, and other similar structures (1). There are no restrictions on the number of properties you can buy in India from the Indian government. Nonetheless, you must keep any funds necessary for the acquisition of the property, including any obtained through inward remittances, in an NRI account.

I hope now you understand whether can NRI buy land in India or not.

Hey Pal,

While going through the above-mentioned responses about “Can NRI buy property in India?” I have come to the conclusion that NRIs are permitted to own residential or commercial properties in India, but they are not permitted to buy any agricultural land, farmhouses, or plantation properties in India.

The Reserve Bank of India periodically provides directives outlining the legislation about NRI purchase property in India and allowing NRIs to buy specific immovable assets in India without first requesting approval from the RBI. The RBI has authorised all NRI buyers of specific Indian real estate with these instructions. In accordance with these rules, NRIs may buy either residential or commercial real estate in India, but not any agricultural land, farmhouses, or plantation holdings. 

It is crucial to recognise that NRIs cannot buy a farmhouse in India under the current regulations because it is popular to own one.

In this way, NRIs living outside of India are not obligated to inform the RBI of any investments they make in either residential or commercial property, even after the transaction has been completed. There are also no limitations on the number of homes or businesses that an NRI can buy in India.

The NRI must use funds in his NRE/NRO or FCNR account, or pay through a banking channel with remittances from overseas, to purchase permissible immovable assets in India.

• Passport:

Indian passports are required for NRIs. If you have an OCI (Overseas Citizen of India) card or a PIO (Persons of Indian Origin) card, you can purchase real estate in India even if you have a foreign passport. 

• PAN Card: 

Required for transactions involving real estate.

• Power of attorney:

In the event that they are unable to complete the purchase deal themselves, NRIs are required to produce a power of attorney. Please be aware that you cannot carry out a real estate transaction without a particular power of attorney that is notarized and registered.

Read More:

As an NRI, you are not required to take any special permission to purchase a property in India. I want you to know that NRIs can only purchase commercial or residential properties. However, they can’t buy plantations, farmhouses, or agricultural plots unless they have special permission from RBI. Read below to know how can an NRI buy a property in India.

It is necessary for every property transaction.

You are required to have an Indian passport. In case you have a foreign passport, then you can purchase a property in India provided you have an OCI (Overseas Citizen of India) card or a

(Persons of Indian Origin) card.

You are required to give a PoA if you can’t visit India to execute the purchase transaction. I want you to know that you will require a special PoA that is notarized and registered and not a general PoA for executing a property transaction.

A PoA authorizes another person staying in India to execute a property transaction on your behalf. You will have to sign the power of attorney in the presence of a consulate officer or notary in whichever country you must be residing in. It will also need to be attested by them.

Best of all, you are not required to take any prior permission from RBI to buy the properties. The laws for such property transactions come under FEMA and you can pay for the purchased property through normal banking channels.

As long as NRIs pay taxes on income earned abroad, money transfer to their Non-Resident Rupee (NRE) A/c in India will be tax-free and completely repatriable (principal and interest earned). Having a saving A/c is not legal under FEMA, and this is why NRO/NRE A/c are available for them.

I can understand that one of the biggest dreams of Indians is to buy a property. No matter which part of the world you stay in; a house in India is a must. Over the years, Indian laws have made it simple for NRIs like us. The RBI governs these transactions and they fall under the FEMA (Foreign Exchange Management Act) purview. Like me, an NRI can buy property in India easily with the help of a company like NoBroker.

NoBroker’s experts will guide you through the process of buying property in India from the USA or any other country. I love NoBroker because of these services:

• Documentation Assistance

• Loan Assistance

• Home Maintenance

• Online Rental Agreement

• End to End Property Management

• 24x7 Sales and Servicing

• Fastest Rent out

• Money Back Plans

Best of all, you get a dedicated field Manager whom you can connect with at any time. They will give you updates on your property so that you know everything that is happening and has nothing to stress about.

I hope now you know how an NRI purchases property in India without any stress.

• Overseas Citizen of India (OCI) Card or Indian Passport

• Power of Attorney Certificate

• Pan Card

NRIs can buy either a commercial property or residential property in India. Additionally, there is no limit on the number of commercial or residential properties that they can buy in India.

However, NRIs can’t purchase a farmhouse, plantation land, or agricultural land in India. They can’t even acquire such properties as a gift.