At Achalare, we take immense pride in the quality of our undertakings, a feeling that is echoed by our NRI customers as well.
If you fall under the NRI or OCB categories, and would like to purchase a property from us, you are sure to find the answers below very useful.
- Can Non-Resident Indians (NRIs) and Overseas Corporate Bodies (OCBs) invest in India?
Provided that the investments are in agreement with Indian laws, RBI rules and regulations, as well as other regulations set forth by the Foreign Investment Promotion Board (FIPB), NRIs and OCBs are free to make investments in India.
- What formalities need to be completed by foreign citizens of Indian origin in order to purchasing residential immovable property in India under the general permission?
Foreign citizens of Indian origin are required to file a declaration via form IPI 7 with the Central Office of Reserve Bank (Mumbai) within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration, along with a certified copy of the document as evidence of the transactions and bank certificates regarding the consideration paid.
- Do NRIs need permission from the Reserve Bank to sell immovable property purchased by them?
Not always. The Reserve Bank has granted a general permission for the sale of immovable property purchased by NRIs. However, if this property is purchased by another foreign citizen of Indian origin, funds towards the purchase consideration should either be remitted to India or paid out of balance in NRE/FCNR accounts.
- Can the sale proceeds of property purchased by NRIs be remitted out of India?
For residential properties purchased on or after 26th May 1993: The Reserve Bank of India considers applications for repatriation of sale proceeds up to the consideration amount remitted in foreign exchange for the acquisition of the property for two such properties. The balance amount of sale proceeds, if any, will have to be credited to the ordinary non-resident rupee account of the owner of the property.
For residential properties purchased before 26th May 1993: Sale proceeds will have to be credited to the ordinary non-resident rupee account of the owner of the property.
- Can foreign citizens of Indian origin give or receive residential property by way of gifting?
Yes, subject to compliance with applicable tax laws and up to two houses. The RBI has granted general permission to foreign citizen of Indian origin to give or receive properties by way of gift from or to a relative who may be an Indian Citizen or a person of Indian origin whether resident in India or not.
- Can a foreign citizen of Indian origin purchase commercial properties in India?
Provided the purchase consideration is met either out of inward remittance in foreign exchange through normal banking channels or out of funds from the purchaser's NRE/FCNR accounts maintained with banks in India and a declaration is submitted to the Central Office of Reserve Bank in Form IPI 7 within a period of 90 days from the date of purchase of the property/final payment of purchase consideration, a foreign citizen can purchase commercial properties other than agricultural land/farm house/plantation property under the general permission granted by the Reserve Bank.
- Does one need to necessarily grant a Power of Attorney (POA) to the developer while purchasing a property?
It is not legally necessary to grant POA to the developer. However, you can chose to give POA to your developer to avoid delays and associated problems involved with the mailing of all documents to your foreign residence. This can also be convenient in case of home loans.
- Can NRIs obtain loans for buying a residential property from financial institutions?
Yes, subject to certain condition, the Reserve Bank has equipped certain financial institutions to grant housing loans to NRIs.
You can find below a list of conditions for NRIs to procure a home loan in India, according to the Reserve Bank guidelines for NRIs:
- The loan amount shall not exceed 85% of the cost of the dwelling unit.
- Own contribution, which is the cost of dwelling unit financed minus the loan amount, can be met from direct remittances from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India.
- Repayment of the loan, comprising the principal and interest, including all the charges, are to be remitted from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India.