Many NRIs who left the country for professional commitments or further studies or any other purposes often try to come to their homeland (India) once they have finished their tasks. Some of them want to purchase a property in India particularly in some progressing states like Kerala. Though earlier, this property purchase procedure was not easy, now the Indian government has become much pliable to these NRIs and are allowing them to purchase villas, apartments and flats in Calicut, Kochi, Thrissur and other major cities in Kerala.
As an NRI, you need to know all the rules and regulations of this property purchase process so that you can complete it in a hassle-free way. Just take a look at this checklist before investing in a property in Kerala.
- Know your property type: As per Reserve Bank of India, an NRI is only eligible for purchasing any kind of residential or commercial property according to his or her wish. But the person can’t purchase ant agricultural land, plantation, or even a farm house in India. They are even not qualified to hold such type of property as a gift from a relative or a well-wisher.
2. Documents: You need to submit certain documents for property purchasing if you are an NRI. Some imperative documents that you need to submit are your address or any other residential proof, your photographs (passport size), your passport, your PAN card with the permanent account number. Without these documents, you won’t be able to purchase any property in India.
3.Verify the seller: Before are making an investment in your property purchase, always verify the seller. There are many fraudulent builders or sellers in the market who will give you an inferior quality material to your flat or apartment. Before giving any payment, always check the builder’s reputation, their previous projects, existing happy customers, feedback, reviews, and their deliverability regarding a project. You may find many reputed builders who will give you your dream villas, flats or apartments in Thrissur, Kochi, Trivandrum and other major cities in Kerala with a budget-friendly price.
4. Loan: The Reserve Bank of India has already given a green signal to all the banks and other registered finance companies to provide loans to the NRI buyers for purchasing their property in India. Though the loan can be sanctioned in the Indian currency, and the lender needs to repay it by the same currency. But the loan amount cannot be credited to the NRI customer’s account rather it must be disbursed either the seller or the developer’s account. The NRI customer can use his NRO or NRE accounts for reimbursing the amount. The bank can pay maximum (80% of the purchased amount), the loan applier needs to pay the rest amount.
5. Repatriation of funds: Repatriation usually means the flow of funds or capital from a foreign country to the country of origin (where the country of origin will be India). In this case, an NRI person can easily transfer his repatriable funds to India in order to purchase some properties in the Indian market. They can easily use their repatriable capital to complete the purchasing process. But it has to remember that all payments should be made in Indian currency.
6.Power of Attorney: As NRI person lives outside the country, so he is eligible to give Power of Attorney (PoA) to his relatives or friends who live in India so that they can easily accomplish the whole purchase process smoothly and successfully.
- Taxation: Tax laws are very simpler for NRIs. According to the rules that are set by the Government of India, NRIs don’t need to pay any taxes when they are purchasing a property in India. They only need to pay stamp duty and registration fees like all other citizens of India. But if they are planning to sell their property, then they need to pay for either long term or short term Capital Gains Tax.
Before investing a single penny in a property, always take a look at this list.