As the adage goes, home is where the heart is!
With reverse brain drain at an all-time high and the fluctuating rupee value, Indian realty has seen a two-fold increase in NRI investment from $5 billion in 2014 to $10.2 billion in 2018. The cities that see maximum property purchase from NRIs are Mumbai, Pune, Bangalore, Gurugram and Chennai. With the introduction of RERA, property investment has become more efficient and transparent, and it is anticipated that foreign investment will increase by 15% in the upcoming financial year.
Here are a few things NRIs should keep in mind before investing in India.
Any individual that holds an active Indian passport and residing outside the country needs no special permission to invest in real estate. People of Indian origin residing in other countries, with the exception of Bangladesh, Sri Lanka, Nepal, Afghanistan, China, Pakistan, Iran and Bhutan fall under the general category.
Terms of home loan
An NRI is eligible to secure a loan up to 80% of the property amount, and the rest should be raised by the individual or group of individuals themselves. The repayment of the loan should be done only in rupees to the bank.
Types of property
For an individual looking to invest in India, there are a plethora of options. An NRI can purchase any type residential or commercial property. For example, you can check out new projects in Chennai to take a look at some upcoming properties. However, a non-resident cannot buy any agricultural land, unless it has been gifted to them.
Any property holder is liable to pay tax, stamp duty, and registration charges in accordance with the Indian tariffs. The property tax will depend on the type and location of the property. Since India has double taxation agreements with over 90 countries, an NRI can claim tax credit on the taxes they may pay on their assets. There are several tax deductions that can be availed to help reduce financial burden.
Power of Attorney
Since the NRI is not always available for day-to-day transactions, it is important to appoint someone with a Power Of Attorney, that can execute these tasks on their behalf. The person appointed can carry out all the requirements of the bank, lease or rent the property, manage or settle disputes arising over the property, or enter into agreements on behalf of the investor. Therefore, the investor must be wise in picking their most trusted associates as their POA.In the current global economic climate, it is anticipated that real estate investments will rise in the coming years. If you are an NRI investor looking to buy property in India, here are a few worthy builders in Chennai for your consideration.