Guide to NRI Property Ownership in India

Over the years, investments in real estate have been one of the most important aspects for NRIs or Non-Resident Indians. However, over a period, it has been observed that some of the rules have changed and made it difficult for NRI people to continue to operate and own property in India. This article is a small guide for NRIs who want to own a property in India.

How to Purchase Property in India as an NRI?

Buying a property in India as an NRI is not difficult, though it requires a few extra steps than buying as an Indian citizen. You can make this easier by leveraging the services of experts at Easidesi who can help you navigate through all the nuances that follow.  

Foreign Exchange Regulation Act

The Foreign Exchange Regulation Act (FERA) is a law that governs the import and export of foreign currency in India. Only Non-Resident Indians are allowed to purchase property in India under the FERA. All investments had to be made through legal channels, and they could not invest directly or indirectly in any business transactions.

However, with the enactment of FERA, NRIs have been given the right to purchase property in India and invest in Indian companies. However, they cannot own a majority stake in any company or establish any business activities without prior permission from the Reserve Bank of India (RBI). The main purpose behind FERA is to ensure that foreign exchange flows into India only through legal channels and prevent illegal transfer of money abroad by misusing various loopholes available in existing laws.

Get a Solicitor

If you plan to buy a property in India as an NRI, you must get a solicitor. There are solicitors who can provide you with easy NRI services in an app at your mobile click to help you through the process of buying the property and will act as an intermediary between you, the vendor and other parties involved in the transaction.

The first step is to identify a suitable location for your property. You can choose from various options, such as apartments, villas, bungalows or commercial spaces. Once you have decided on a location, get in touch with your solicitor, who will guide you through every step.

Get A Local Power of Attorney For The Property If You Won’t Be Living in India

When buying property in India as an NRI, you must keep a few things in mind. First, you need to get a local power of attorney for the property if you won’t be living in India. This is because the government requires you to have somebody on the ground who can represent your interests.

Next, ensure that your attorney is registered with the state bar association and has experience representing foreign investors who want to purchase property in India. You will also need a lawyer who understands how the legal system works here so that they can help you navigate any issues that arise throughout the property management services. Being an NRI this will become very easy soon with an upcoming easi-concierge app for property management which can connect you with all necessary details with expert support.

Understanding the documentation required for buying a property in each state is important. Most states require a stamp duty and registration fee, which can vary depending on the property’s value. You also need a home loan from a financial institution.

Most states require you to submit an affidavit and other documents proving your identity. These include your passport, visa, PAN card and bank statements. In some cases, you may need additional documents such as the birth certificate, marriage certificate and death certificate of any previous property owner if it is inherited or has changed hands within three years before purchase.

In addition to these documents, other requirements vary by state. For example, some states require you to submit documents related to your income tax returns, while others do not have such requirements but may require proof that you have sufficient funds to purchase the property without taking out a loan known as “cash-free.”

Banking and Finance

Buying property in India can be a confusing process for non-resident Indians (NRIs). The important thing to do is to find out if you are eligible for a home loan. This depends on your income, bank balance and whether or not your country has a double taxation avoidance treaty with India. If you are eligible, you will need to find out what kinds of loans are available in India and how much different banks will charge interest rates. The RBI allows buyers, including non-resident Indians (NRIs), to avail up to 80% of the overall property value through loans from financial institutions.

What Are the Tax Implications in Case NRI Sells His Property in India?

If an NRI purchases real estate in India from a resident, he must deduct 1% tax if the sale price exceeds Rs. 50 lakhs. If he buys property from a non-resident and applies long-term capital gains taxes, which are applicable on transactions above 2 years of ownership in India, then he should pay TDS at 20%.

If you have to pay short-term capital gains tax for every sale, the government will deduct 30 percent of the profit on your property. This rule applies if a property is sold within two years or less from when it was acquired. 

In addition, you must deposit the tax deducted within 30 days of such deduction. If you fail to do so or if your deposit is late by even one day, the penalty for this violation will be 1% per month from when you should have deposited taxes until they are paid.

How to get a Bank Loan For Purchasing Property as NRI?

Because NRI investment in the Indian real estate is limited to residential or commercial properties, all banks can finance only these types of purchases. A person is also eligible for loan if he buys land or constructs a house in India.

You can apply for a home loan both in person and online. The documents required will depend on whether that NRI is salaried or self-employed. The documents needed to support an NRI’s application will depend on where the person resides. However, all applicants must provide copies of their passport and visa and photograph-size images; proof of their residence in another country is also required.

For a salaried NRI, the minimum period of stay in their current country of residence is two years. For self-employed NRIs, it is five years in case they have settled abroad and seven others not so settled; otherwise, there is no such requirement for loan eligibility. Banks may also require an NRI guarantor or a co-applicant. The NRI guarantor will also have to submit documents for identity, address, and income proof.


Many things should be kept in mind for successful property investment, for instance, the prime location, amenities, future growth and specialties of your chosen destination. Several government agencies are dealing with the task of investment promotion in India. You would be well advised to study the credentials carefully of these NRI property management services before you arrive in India.

Dorothy Gracious

Dorothy Gracious is a professional content writer having 8+ years of experience. Presently working as a freelancer and love to write about the latest Business, technology, health, and lifestyle-related articles.