Under the RBI’s guidelines, a non-resident Indian (NRI) is allowed to purchase certain types of properties, while other forms of realty may require special permissions
Any non-resident Indian (NRI), who is interested in buying a property in India, should be aware of certain legal provisions pertaining to the purchase or owning of an immovable property in India under the Foreign Exchange Management Act (FEMA).
NRIs and persons of Indian origin (PIOs) are treated at par, for the purpose of investment in real estate.
Types of properties, where NRIs or PIOs can invest
NRIs and Persons of Indian Origin (PIOs) are generally allowed to invest in real estate in India. The RBI has granted general permission for NRIs to purchase residential and commercial properties. This means that you do not need to seek specific approval from the RBI to buy these types of properties.
Key points about NRI property ownership:
- NRIs can buy residential and commercial properties without requiring special permissions.
- There are no restrictions on the number of properties an NRI can own.
- Income tax laws in India allow NRIs to own as many residential or commercial properties as they wish.
Continuance of ownership of property, after becoming an NRI
If someone already owns property in India and later becomes an NRI, they can continue to hold the property in their name. The rules for continuing property ownership include:
- An NRI can continue owning agricultural land, plantation property, or farmhouses that they owned before becoming an NRI.
- NRIs can rent out the property and receive rental income, provided Indian taxes are paid.
- NRIs can sell or gift property to residents in India. They can also transfer property (other than agricultural, plantation, or farmhouse properties) to other NRIs.
Conclusion
In summary, NRIs have the flexibility to invest in residential and commercial properties in India without needing special permission. However, there are restrictions on agricultural land, plantation properties, and farmhouses. It’s important to understand the legal guidelines to make informed decisions when investing in real estate in India.
Frequently Asked Questions
- Can an NRI buy property in India?
Yes, NRIs can buy residential and commercial properties in India without needing special permission. - Can an NRI purchase agricultural land in India?
No, NRIs cannot buy agricultural land in India unless they get specific permission from the RBI. - Can NRIs continue to own property in India after moving abroad?
Yes, NRIs can continue owning property in India and even rent it out, as long as they pay Indian taxes.