Saturday, 3 January 2015

FAQs on the guidelines of NRI investment in real estate of India

What is the best time for an NRI to buy property in India?
When the value of Indian Rupee falls increasing the value of foreign exchange is the best time for investment in the Indian real estate by the NRIs. Moreover one should keep a check on the RBI grants and the various offers given by banks and developers to attract foreign capital and Foreign Currency Non-Resident Deposits.

Which are the property types that an NRI can purchase in India?
The general permission issued by the RBI states that a Person of Indian Origin or an NRI is free to purchase any residential or commercial property in any part of India which won’t require any specific permission from any authority or the RBI.  In case a NRI or a PIO (Person of Indian Origin) wants to buy any agricultural land or farmhouse or a plantation, he or she has to obtain a specific permission from RBI.

FAQs on NRI Investment in Real Estate of India

What are the RBI guidelines on procurement of home loan by a NRI on residential property?
RBI has granted general permission to banks and financial institutions and the Housing Finance Corporation (HFC) which is registered with National Housing Bank to give home loans to NRIs for buying residential properties in India. These loans granted should be on the same basis of granting loans to the Indian residents. The loans should be given in Indian Rupees and is payable in Indian Rupees too. The regulations of RBI states that the loan amount won’t be credited directly to the NRI’s account and should be disbursed to the builder or the seller. This loan should be procured by an equitable mortgage of the property being bought by the NRI. Although the lender is allowed to accept any other property or asset in India as security.

What are the procedures for repayment of the loan by the NRI?
The home loan obtained by the NRI from the banks, financial institutions or the housing finance companies can be serviced through many channels and he or she can pay the EMI by way of easy remittances through the banks. The NRE (Non Resident External) account or the Foreign Currency Non –Resident Deposit account (FCNR) deposits can also be used in servicing the loan and his or her NRO account also. According to the guidelines set by the RBI, the rental income accrued or received from such properties can also be used for the purpose of servicing the EMIs.

What is the number of properties that an NRI can purchase?
There are no restrictions for the number of properties an NRI can purchase.

What is the procedure for repatriation of the sale proceeds of the property?
If the NRI has purchased any property through home loan the repatriation of the whole amount of the sale proceeds are not allowed. The NRI is allowed to repatriate only the sale proceeds of two properties outside India as per the guidelines. The guidelines state that the repatriation amount is restricted to the amount paid in foreign currency. This will necessarily include the funds which were remitted directly from abroad or the money utilized from the FCNR account or the NRE account as well. If the funds were utilized from the NRE account the amount repatriated would be limited to equal amount of foreign currency that was used at the date of payment.

Is there any lock-in period for the selling of the property?
There is no lock-in period for selling the property bought by a NRI. The NRI can sell the property anytime and an amount equal to one million USD can be remitted every year from the NRO account.

19 comments:

  1. The recent trend of real estate market of Bangalore seems to overcome from the last year sluggish market, during last year buyers either buying for their personal use or for investment they always having second thoughts in their mind before investment. This year the market came with good sign that so many foreign investors are searching to invest in real estate market of India because of the political establishment and the unchanged interest rate.

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    1. Because of new RBI guidelines more NRI investors are able to apply for home loan with easy documentation in residential purpose. Most of the financial institutions are now focusing on NRI which is a good symbol for real estate market and Bangalore has all the reasons to attract foreign investors

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  2. My uncle was trying to buy the property in India, but he was scaring to purchase. After gone through this site post I recommended him to buy the property without any worries because RBI is approved and granted permission to allow loans as like Indian residency to the NRI’s. Thanks for helping me and to my uncle by describing useful contents..

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  3. Every investment is made for its returns, today in India the returns from real estate market is considerably higher than any investment with financial institutions, these financial institutions consider NRI's as their major client so getting home loan is an easy task for them. Real estate investors witness that the property price of India keeps increasing from every passing year ensuring a definite returns on it. Again the open market of India with a decline rupee value keeps attracting NRI’s to invest here. So more NRI's are turning to invest in real estate market.

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    1. Of course Mr.Subhojit Dey investments are meant for profit only and a smart investor invest after checking all statistical data and recent trend in the market. In real estate market the price of a property depends according to its locations and connectivity again it varies from builders to builders, there are builders who sells there projects twice then its actual cost and there are builders who are selling its projects in same localities with very less price. So investors need to buy it as low as it possible then only they can sell their properties at a market rate.

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  4. Due to the slowdown of market in last year, the government granted permission for the NRI’s to purchase the homes or lands without any specific permission. If once RBI granted means NRI can buy the property s like Indian.RBI planned well to attract Foreigners capital to invest into India due to the increases the rate of currency. So that market also easily grown up if investor are more.

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  5. From the many servey its prove that the Indian property price is increasing day by day. The Indian origin people from outside India is eager to invest in property. But they have some certain time to invest. The India rupees decreasing in the international market right now. So it is the best opportunity for the NRI's for gaining some wealth n India.i

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  6. Hi, now present I’m working in abroad, I was planning to buy the property in Bangalore city but I was scaring about I won’t get loan from the bank because for me treat as NRI. While searching the property sites of Bangalore I got this site, from this site the guidelines which are mentioned is helped me a lot and came out from the scared. Now I will try to buy the property as soon as possible before any other rules come.

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  7. From last 1 year the investment of NRT's in Bangalore real estate is increasing up to 35%. That means NRI's want to settle here of for the future use they are investing. In such condition they want some suitable ares which can be a quality investment for them.

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  8. Specially NRI's wants to invest in residential projects in suitable location.After guide line issued by RBI it has been easy way to buy and sell a property for NRI. And also the Bangallore builders are looking for the NRI because they will invest a big amount in properties.

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  9. I think this is the good time for the NRI’s to invest their money into India and get their dream home or expect good returns within 2-3 years. Now the currency is increased in terms of dollars to rupees so why NRI’s should is missing this opportunity. Hurry up …!

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  10. Wherever I visited the builders in Bangalore at those builder I found only NRI’s, from my point of view 50-60% are NRI’s investors we can get to see in this fastest city. At present there is huge booms of NRI’s itself because the currency rate is increased by this year so that is the reason NRI’s are taking more interest into this city.

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  11. Thanks RBI governance for granting the Home loans to NRI are based on granting loans to the Indian residents. And thanks a lot for allocating same ROI as what applying to the India Residents. I will definite buy the luxury in Bangalore by taking loan from the national Banks.

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  12. There is no restriction of buying any number of property to the NRI’s so this the reason since from last year ending so many NRI’s are taking participate to invest their amount into India. I think this opportunity made happy to the NRI’s given chance to buy their dream home in India.

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  13. I will definitely suggest this news to my cousin about this NRI investment, who is staying in Abroad. His aim is to have his own home in India but he was scaring to invest, he always tells me to see the affordable homes in Bangalore. I think this news will give him more happy, thanks for this blog posting…

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  14. So many people are from other country taking interest to invest into Indian properties after gone through the news of nri investments can buy any property in India same like Indian people. The govt allocated properties to the nri’s at the same price of what the Indian people are getting homes. And if the nri want to resell the property nri can do it without any issues.

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  15. This is good opportunity for the NRI to invest their foreign money into Indian real estate as the rupees falls increased so that RBI is helping to the NRI to have their own homes as like Indian People. With the same rules which are applying to the Indian like: ROI, selection of homes, Reselling of homes, types of property, home loans and many more… this kind of golden chance will never come again, don’t miss it..!

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  16. NRI Investors are identifying buildings and zoning norms, and plans on investing their hard earned money in developments of commercial projects near to the metro areas of Bangalore city to enjoy in future for premium rentals.

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  17. Hurry up NRI’s to catch this opportunity doesn't know when this opportunity will be disclosed. This kind of golden opportunity comes very rare, so NRI’s can be fully utilize this strategy and invest your hard earned money as like Indian investors without any extra Interests.

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