An NRI’s Guide to Investing in Real Estate in India

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hardik, April 18, 2019

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With the GDP of the country expected to increase from 7.3% in 2018 to 7.73% by 2022, the Indian economy is all set to soar.

Increasing job opportunities in metros are already attracting people from all states, which means that India is likely to see a lot of development and progress in the real estate sector as well. Thus, investing in properties located in prime spots will yield attractive returns over time.

As an NRI, while investing in real estate may seem daunting due to the complex regulations, buying a real estate property will surely grow your wealth. Here is a guide you can use to invest in Indian real estate easily.

FEMA and RERA

As an NRI real estate investor, the rules of the Foreign Exchange Management Act (FEMA) apply to you. According to these rules, you can purchase any immovable property in India except agricultural land, farmhouses, and plantations.

However, you are not eligible to invest or transfer a real estate property if you are a citizen of Pakistan, Sri Lanka, Bangladesh, China, Afghanistan, Nepal, Iran or Bhutan without the RBI’s prior permission.

Once you qualify basis these rules, choose a project that has a RERA registration. Thanks to the implementation of RERA, you can know everything about a property in advance and invest only when you are 100% sure.

Using the RERA registration number will help you find property details on the website in an instant. Moreover, even if you’re buying an under-construction project, you will always have all the information on your fingertips courtesy of RERA.

Additional Read: Your Easy Guide to Buying Real Estate in Pune

Choosing an area and type of property

You can earn better returns, by way of regular rental income or high resale value, when you invest in real estate in a rapidly developing city.

Additionally, you must consider buying a property in an under-construction project if you aren’t in any hurry to enjoy rental income immediately and are looking to make a nominal investment. Moreover, this also benefits you as if the project isn’t completed on time, as per RERA guidelines, the builder owes you compensation.

Researching properties

Whether you are buying a property for relatives or children back home, for rental purposes or as a holiday home, research the real estate market thoroughly before investing.

Study the trends of real estate prices in various cities or localities for the last few years and narrow down on those that hold potential for profit. Also pay attention to aspects like the existing infrastructure, neighbourhood, and amenities. This will help you select the best options.

Power of attorney

You can appoint a Power of Attorney (POA) to complete property purchase on your behalf. Once appointed, this person will perform all the necessary actions that you would if you were physically present and ensure that your interests aren’t compromised.

So, consider appointing trusted family members or friends as your power of attorney.

Additional Read: 5 Reasons Why Buying a Flat in Bangalore is a Smart Investment

Financial planning

Next, get your finances in order to make the purchase. This may mean taking stock of your savings or relying on external sources. If you apply for a home loan in India, then your age, income, education, and other eligibility factors set by the lender will determine the total amount you can borrow.

The documents that you need to submit will be based on your country of residence. Some of the documents that you will need are a Commencement Certificate, Intimation of Disapproval (IOD), passport, visa copy, PAN card, sale deed, bank statement, income certificate, and address proof.

Make sure to submit all the required documents in a single go to hasten home loan approval.

Also keep in mind that you are required to transact in Indian currency, and you can access your income from abroad via an NRE/NRO account. So, open an NRE or NRO account with an authorised Indian bank to enjoy ease of transacting. If you wish to set up Electronic Clearing Service (ECS) or issue post-dated cheques, they must be from your NRE/NRO account too.

Clearance documents

A real estate investment involves a large amount of money and so, it is important to ensure that the developer issues documents like a no-dues certificate, encumbrance certificate, and the title deed of ownership.

Confirm that legal, environmental, and municipal clearances are met for the property you are planning to buy to ensure that you don’t have to face any hassles later on.

While these steps outline the key pointers you should be aware of, you can start your property search simply with Bajaj Finserv Homes & Loans. Apart from help with documentation, property search, and property visits, it also offers a easy home loan sanction of up to Rs.3.5 crore so you don’t have to compromise on any aspect. Whether you are looking for flats for sale in Bangalore or any other city, Bajaj Housing Finance Limited lists options that suit varied styles, preferences, budgets, and priorities.

So, if you are looking to invest in a property in Bangalore, consider RERA compliant projects like Skylark Dasos that are in close proximity to workplaces and business parks like Manyata Tech Park and Concentrix, and offer luxurious living at affordable prices.

Start right away by checking your pre-approved offer to enjoy quick approval and expedite financing.