Increasing numbers of NRIs are now choosing to invest in the growing real estate market in India. Here are the top five things NRIs must be aware of before investing in real estate:
Foreign Exchange – NRIs must comply with the Foreign Exchange Management Act of India. Loans availed in India must be paid in Indian Rupees. Overseas Citizens of India and persons of Indian origin do not require special permission from the Reserve Bank of India. However, NRIs can only invest in commercial and residential property. They cannot invest in agricultural land or farmland.
Property Type and Builder – NRIs can choose either residential or commercial properties to invest in. It is imperative that you ascertain the reputation of the builder and the type of property before you invest. Also, ensure that the development has cleared all legal formalities.
Loans – NRIs can avail of home loans to purchase property with eligibility for up to 80% of the property value. A non-resident external account is preferred while applying for a home loan. This will also enable a smooth transfer of money in the event of the property being sold.
Power of Attorney – This enables another person to stand in legally for the homeowner. This is especially important for NRIs who cannot be around personally to oversee their property. It is imperative to have a trustworthy, credible person as the Power of Attorney.
Taxes – Any proceeds from real estate transactions are taxable according to Indian income tax laws. Short Term Capital Gains taxes of 30% and Long Term Capital Gains taxes of 20% are applicable on properties sold in India. NRIs investing in real estate in India must have a working knowledge of Indian tax laws.
Prestige properties, with their strong legality, superb amenities, easy loan approvals, and guaranteed appreciation, are the perfect investments for NRIs.
The Prestige City new launch township at Sarjapur Road, East Bangalore.