REAL ESTATE INVESTMENT
Real estate sector in India is on upturn. Research estimates that Indian Real Estate market is expected to grow from the current USD 14 billion to a USD 102 billion in the next 10 years. The main growth thrust is coming due to favorable demographics, increasing purchasing power, existence of customer friendly banks & housing finance companies, professionalism in real estate and favorable reforms initiated by the government to attract global investors.
POTENTIAL GROWTH AREAS
Indian real estate has huge potential demand in almost every sector especially commercial, residential, retail, industrial, hospitality, healthcare etc. Commercial office space requirement is led by the burgeoning outsourcing and Information Technology Industry. The leaders of the IT/ITES world have set up or are setting up their centers in India. Estimated demand from IT/ITES sector alone is expected to be 150mn sq.ft. of space across the major cities by 2010.In residential sector there is housing shortage of 19.4 million units out of which 6.7 million are in urban India. The increase in purchasing power and exposure to organized retail formats has redefined the consumption pattern. As a result the country has experienced mushrooming of retail projects across the cities.
Rules relating to NRI/PIO (Person of Indain Origin) investment in real estate have been considerably liberalized and simplified. Foreign citizens of Indian origin (PIOs) have been permitted to invest without the need to obtain approval from the Reserve Bank of India. With the passage of FEMA, the power to effect repatriation proceeds has been decentralized and delegated to authorized foreign exchange dealers. What is more, even the rental income can be repatriated now. It makes sense for NRIs now to earmark a portion of their investment portfolio in real estate and earn competitive return on investment. In exercise of the powers conferred by clause (i) of sub-section (3) of Section 6, subsection.
OVERSEAS CORPORATE BODY (OCB)
* Companies, partnership firms, societies and other corporate bodies
* Owned, directly or indirectly,
* To the extent of at least 60% by individuals of Indian nationality or origin resident outside India as also overseas trusts in which at least 60% of the beneficial interest is irrevocably held by such persons.
The various facilities granted to NRIs are also available, with certain exceptions, to OCBs so long as the ownership/beneficial interest held in them by persons of Indian nationality/origin resident outside India continues to be at or above the level of 60%
FOREIGN DIRECT INVESTMENT IN REAL ESTATE
FDI provides for 100% foreign participation by NRI/OCB's in housing and real estate development sector in following areas:
* Development of serviced plots and construction of residential premises
* Construction of residential and business premises including business centres and offices
* Development of townships
* City and urban infrastructure facilities
* Manufacture of building material
* Participatory ventures in all of the above
* Investment in housing finance institutions
ACQUISITION OF PROPERTY IN INDIA BY AN NRI:
A person resident outside India who is a citizen of India may acquire any immovable property in India other than agricultural / plantation/farm house.
TRANSFER OF PROPERTY IN INDIA BY AN NRI:
A person resident outside India who is a citizen of India may -
* Transfer any immovable property in India to a person resident in India.
* Transfer any immovable property other than agricultural or plantation property or farmhouse to a person resident outside India who is a citizen of India or to a person of Indian origin resident outside India.
ACQUISITION OF PROPERTY IN INDIA BY A PERSON OF INDIAN ORIGIN(PIO)
A person of Indian origin resident outside India may -
* Acquire any immovable property other than agricultural land/farm house/ plantation property in India by purchase, from out of
1. Funds received in India by way of inward remittance from any place outside India or
2. Funds held in any non-resident account maintained in accordance with the provisions of the Act and the regulations made by the Reserve Bank under the Act.
* Acquire any immovable property in India other than agricultural land / farm house /plantation property by way of gift from a person resident in India or from a person resident outside India who is a citizen of India or from a person of Indian origin resident outside India
* Acquire any immovable property in India by way of inheritance from a person resident outside India who had acquired such property in accordance with the provisions of the foreign exchange law in force at the time of acquisition by him or the provisions of these Regulations or from a person resident in India
* It is necessary for a PIO to purchase property through NRE or NRO accounts.
TRANSFER OF PROPERTY IN INDIA BY A PERSON OF INDIAN ORIGIN
A person of Indian origin resident outside India may -
* Transfer any immovable property in India other than agricultural land/farm house/plantation property, by way of sale to a person resident in India
* Transfer agricultural land/farm house/ plantation property in India, by way of gift or sale to a person resident in India who is a citizen of India
* Transfer residential or commercial property in India by way of gift to a person resident in India or to a person resident outside India who is a citizen of India or to a person of Indian Origin resident outside India.
* Transfer an immovable property being agricultural land or plantation property or farmhouse in India by way of a gift or sale to a person resident in India without any permission from the RBI provided that the purchaser is a resident as well as a citizen of India.
ACQUISITION OF IMMOVABLE PROPERTY FOR CARRYING ON A PERMITTED ACTIVITY:-
A person resident outside India who has established in India in accordance with the Foreign Exchange Management (Establishment in India of Branch or Office or other Place of Business) Regulations, 2000, a branch, office or other place of business for carrying on in India any activity, excluding a liaison office, may -
* Acquire any immovable property in India, which is necessary for or incidental to carrying on such activity; Provided that
1. all applicable laws, rules, regulations or directions for the time being in force are duly complied with; and
2. the person files with the Reserve Bank a declaration in the form IPI annexed to these regulations, not later than ninety days from the date of such acquisition
* Transfer by way of mortgage to an authorized dealer as a security for any borrowing, the immovable property acquired in pursuance of clause (a).
REPATRIATION OF SALE PROCEEDS:-
* A person referred to in sub-section (5) of Section 6 of the Act, or his successor shall not, except with the prior permission of the Reserve Bank, repatriate outside India the sale proceeds of any immovable property referred to in that sub-section
* In the event of sale of immovable property other than agricultural land/farm house/plantation property in India by a person resident outside India who is a citizen of India (NRI) or a person of Indian origin (PIO), the authorised dealer may allow repatriation of the sale proceeds outside India, provided the following conditions are satisfied, namely
1. The immovable property was acquired by the seller in accordance with the provisions of the foreign exchange law in force at the time of acquisition by him or the provisions of these Regulations
2. The amount to be repatriated does not exceed
+ The amount paid for acquisition of the immovable property in foreign exchange received through normal banking channels or out of funds held in Foreign Currency Non-Resident Account or
+ The foreign currency equivalent ,as on the date of payment, of the amount paid where such payment was made from the funds held in Non-Resident External account for acquisition of the property.
* In the case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties.
* In the case of the sale of an immovable property, other than an agricultural land/farm house/ plantation property in India by an NRI or PIO, repatriation of the sale proceeds outside India (including credit to RFC, NRE or FCNR Accounts), is allowed.
* Sale proceeds of any immovable property inherited by NRI/PIO from a person resident in India may be remitted abroad but the amount not to exceed USD one million, per calendar year subject to production of documentary evidence in support of inheritance and Tax clearance certificate/no objection certificate from Income Tax authority to authorized dealer for remittances.
* The RBI has also now permitted authorized dealers to allow the facility of repatriation of funds by NRI/PIO in their Non-resident Ordinary Rupee (NRO) Account up to US $ 1,00,000 per year representing the sale proceeds of the immovable property held by them for a period of not less than 10 years subject to payment of the applicable taxes.
Prohibition on acquisition or transfer of immovable property in India by citizens of certain countries.
No person being a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan without prior permission of the Reserve Bank shall acquire or transfer immovable property in India, other than lease, not exceeding five years.
GENERAL INFORMATION REGARDING REAL ESTATE:
* NRIs and PIOs may acquire any immovable property for residential/commercial purposes in India, other than agricultural/plantation/farm house, without the permission of Reserve Bank of India.
* No declaration is required to be made to the RBI. Only information regarding details of the property and costs incurred should be given to the RBI. This will help at the time of repatriation.
* No permission from the RBI is required to transfer any immovable property other than the agricultural land or plantation property or a farm house in India by way of sale to a person resident in India.
* The lock-in period of 3 years has been done away with.
* If property has been acquired through NRE account then repatriation is allowed only for 2 residential properties.
* NRI/PIO is permitted to transfer by way of mortgage his residential commercial property in India to an authorized dealer/housing finance institution in India.
* NRI/PIO can avail housing loan in rupees from an authorized dealer or housing finance institution in India approved by the National Housing Finance Bank for purchase of residential accommodation or for the purpose of repairs/renovation/improvement of residential accommodation, subject to certain terms and conditions.
* Sale proceeds of residential/commercial property received by way of gift by NRI/PIO can only be credited to NRO account.
* Sale proceeds of any immovable property in India inherited, by a person resident outside India (i.e. NRI or PIO or foreign national of non-Indian origin resident outside India), from a person resident outside India cannot be repatriated by him or his successor without prior permission of the RBI.
* NRI/PIO can rent out the residential/commercial property purchased out of foreign exchange/rupee funds.
* The purchase consideration should be met either out of inward remittances in foreign exchange through normal banking channels or out of funds from NRE/FCNR accounts maintained with banks in India.
* The non-resident Indians who are staying abroad may enter into an agreement through their relatives and/or by executing the Power of Attorney in their favour as it is not possible for them to be present for completing the formalities of purchase (negotiating with the builder or Developer, drafting and signing of agreements, taking possession, etc.) These formalities can be completed through some known person who can be given the Power of Attorney for this purpose. Power of Attorney should be executed on the stamp paper before the proper authorities in foreign countries. Power of Attorney cannot be drafted on the stamp paper bought in India.
* Residential property can be given on rent if not required for immediate residential use. Rental income cannot be remitted abroad and will have to be credited to the ordinary non-resident rupee account of the owner of the property.
* No taxes to be paid while purchasing property.
* Certain taxes to be paid when selling property. If NRI/PIO has held property for less than 3 years then he would have to pay 30% tax. If property has been held for more than 3 years then tax payable is 20%. Tax is payable on rental income too.
* At the time of renting out property or repatriation PAN CARD is required.
BUYING/SELLING OF PROPERTY
Today, property buying and selling has become faster, complex and competitive in all the ways. It is not just getting a property but fulfillment of a dream. Our main goal is to provide quality service to the people in acquiring their dream property. The member's contentment is foremost in all our services.
If you are a member who is thousands of miles away from the home country and want to own a property or you have a property for which you need to find a tenant or buyer, to handle the property or just want the property to be maintained, our Nrirealestates takes the pride to undertake NRI services with most care and caution.
We offer the following NRI Real Estate Services:
Invest in your motherland i.e. India a roaring economy to maximize your profit. Investment Services is our special endeavor to support NRI investments into the Real Estate industry in a reliable, transparent & convenient manner. We bring to you an exclusive range of residential lifestyle projects from the finest developers of India whose names signify quality developments.
(1) Property Search
If you want to buy a property in a particular area and you need to know the details of the same, we will give a report about the availability of the property through email. Under this package, we send you details of 5 premium properties in the location of your preference. These E-mails include details such as the seller’s contact number and address, the property description, the cost of the property and much more.We will promote your requirements in the city special page Send your requirements details to 1000's of sellers in your city and collect responses and send summary once a week, till we find the seller for your requirements.Advertise your requirements in the local news paper and collect the response and send summary for a week.We will also monitor newly added listings, If it suits your requirements we will call you and inform.
(2)Property Price Negotiation
If you have decided to buy/sell the property and if a request is made for price negotiation, our service team will negotiate with buyers and sellers regarding the price on your behalf. You can very well relax without any stress or tension, as once our service team takes up a task; it means ”YOUR JOB IS DONE”. As we are aware that a lot of formal and legal procedures should be followed during the deal, we assist you in all such essential transactions throughout the process of property negotiation.
(3) Property legal verification
Attaining the ownership of the property should be simple and without stress.Our Specialized NRI services team will deal with all the legal works to be carried out during the whole process. This online NRI service will make you feel easy to own a property sitting leisurely at your home.In case of the ordinary realtors there will be an instinct of fear in you whether the chosen property is worth enough to the payment made. Our team members will verify the property directly in person and confirm its reality.Once the service team concludes the process of legal verification, we make an assurance for the property after which you can splendidly proceed with the dealings with full confidence.
(4) Additional photos and video for property Residing in some other country, you might not wish to buy a property with out having a glance at it. Hence, on your request, we provide you with additional photos and video which enables you to have a look at the property.
(5) Property Price Monitoring Charges
The property you already have in India are getting costlier with every passing day. We can monitor the price of your property on regular fortnight basis and will keep you informed by confidential e-mail with updated prices.