Your Gateway to Exceptional Real Estate Investment in India
Investment Eligibility under FEMA (H2) According to the Foreign Exchange Management Act (FEMA), Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) enjoy significant freedom when investing in Indian real estate.
Permitted Properties
NRIs can freely purchase any number of residential or commercial properties.
Restricted Properties
Under standard RBI guidelines, NRIs are not permitted to purchase agricultural land, plantation property, or farmhouses. However, these can be acquired through inheritance.
Financial Channels and Payment Methods (H2) The RBI has streamlined the payment process to ensure transparency. When purchasing a Prestige property, funds must be remitted to India through normal banking channels.
NRE (Non-Resident External) Account
Ideal for funds remitted from abroad; these funds are fully repatriable.
NRO (Non-Resident Ordinary) Account
Used for income earned within India (like rent or pension).
FCNR (Foreign Currency Non-Resident) Account
Deposits held in foreign currency can also be used for property acquisition.
Repatriation of Sale Proceeds (H2) One of the most common questions from global investors is about moving money back abroad. The RBI allows the repatriation of sale proceeds under specific conditions:
The amount repatriated cannot exceed the original investment amount if paid via NRE/FCNR.
For residential properties, repatriation is restricted to the sale proceeds of a maximum of two properties
Profits (Capital Gains) can be repatriated after the payment of applicable taxes in India.
Regulatory Requirements
The Role of PAN and Aadhaar To complete a property transaction in India, an NRI must possess a Permanent Account Number (PAN). While an Aadhaar card is not strictly mandatory for the purchase, it is highly recommended to simplify the registration process and utility connections.
Income Tax Implications NRIs are subject to Tax Deducted at Source (TDS) when purchasing property.
If buying from a Resident Indian: 1% TDS (for properties above ₹50 Lakhs).
If buying from another NRI: TDS rates vary based on capital gains.
Faq's
A: No. General permission has been granted by the RBI to NRIs to invest in residential and commercial real estate. You do not need to file any specific documents with the RBI at the time of purchase.
A: Yes. RBI guidelines allow Indian banks and housing finance companies (registered with NHB) to provide home loans to NRIs for the purchase of residential property. The loan must be repaid in Indian Rupees.
A: Yes, an NRI can purchase a property jointly with a resident Indian or another NRI, provided the financial contributions are documented through the correct banking channels