NRI investment in real estate is one of the most traditional forms of investment and is also known to be the safest form of investment with almost guaranteed returns on investment. This sentiment holds true all over the world. However, there are more reasons why NRIs look back at real estate investment in their home country, India. Apart from the obvious that real estate in India is booming and the graph looks great even for the future, it is the fact that NRIs are always looking to build a home that they can come back to. And in most cases, the emotional reason outweighs the practical one.
According to data and research, it has been noted that India offers more value for money and better returns in a small period as compared to the real estate markets of other countries. India has known the world over, as one of the largest and fastest growing economies in the world. Owing to this development the real estate prices are fast rising and those who had invested earlier on are making huge profits. It is only natural that this growth will continue and thus, more NRIs are looking at Indian real estate to make investments.
NRI investment in Indian real estate has been made easier and more profitable, thanks to the new reforms and regulations brought in by the government. Because of RERA (Real Estate Regulations Act) and GST (Goods and Services Act), NRI investment options in India has grown and has eased up the entire process. RERA enforces strict regulations in the real estate market that is known for its ambiguous nature of the business. This means more transparency for the builders and consumers, alike. Subsequently, now NRIs can invest in Indian real estate knowing everything about the property inside-out. Timely possessions are also taken care of by the introduction of RERA and thus, consumers are more inclined towards real estate now.
An NRI is expected to pay service tax, registration, and booking amount at the time of booking the house. However, NRIs are subject to the same taxes as that of an Indian resident. The same goes for the tax benefits. That being said, if the NRI sells off his property within 3 years of having purchased it, his earnings are then taxable. There are also no restrictions on the number and type of properties that NRIs can invest in. Whether it is a residential property or a commercial property, NRIs can invest in both cases with no prior permission, all they need is an Indian passport. The only constraint being that NRIs can’t invest in agricultural land.
NRIs must be abreast with several rules in case of their investments. But they can invest in real estate simply using their Non-Residential External Account (NRE), Non-Resident Ordinary Account (NRO) or Foreign Currency Non-Resident Account (FCNR). They can even procure home loans for making their investment.
Multiple NRI investment options in India have opened-up and it is the right time for NRIs to invest in Indian real estate. With new regulations that have eased up the process, there is no reason for NRIs to think twice before signing on the dotted line.
