Things to consider by NRIs,while buying a property in India

NRIs to keep in mind while buying a property in India:

What are you reminded of when you think about your childhood home in India? The freshly sprinkled water on the ground in front of the main door? The aromas of delicious filter coffee and Grandpa’s crisp newspaper noises while reading it. The bright sunlight beaming through the east-facing windows, the white noise while dad tunes the radio, the pungent smell of coconut oil from Grandma’s brushed sleek hair, and the freshly plucked jasmines adorned by mom. Did that nostalgia hit you hard?

Since people have moved out of India for a better standard of living, to travel all over the world, or for better work opportunities, they miss out on a lot of things that India holds as their home country. No matter where you live, your roots will permanently be attached to India. Buying a property in India is everyone’s dream, and NRIs are not refraining from it. Though you live abroad, you can still purchase land or buy a property in India.

Here are key points for NRIs to keep in mind while buying a property in India:


Any NRI can purchase land in India. That is, NRIs can buy residential or commercial properties.
There are no restrictions or limitations on buying property in India. NRIs do not require any kind of special permission while buying a residential property or commercial property.
But NRIs need special permission from the Reserve Bank of India (RBI) to buy farmhouses, agricultural lands, and plantation lands.If you are an NRI, real estate investment in India will yield you significant income, as real estate has been at its peak recently.


If buying property from NRI, Tax Deducted at Source (TDS) calculation is done at 30.9% on short-term capital gains and 20.6% on long-term capital gains.
After TDS on property purchases from NRI, the final taxation rate is similar for NRIs and resident Indians.
If an NRI has a lower tax slab applicable, he can apply for a refund of TDS by filing their tax returns.

Home Loans:

RBI has passed general permission to banks and housing finance agencies registered under National Housing Bank to provide loans for NRIs while buying property in India.
The loan has to be sanctioned in Indian currency and has to be repaid in the same currency.
But it is essential to know that the loan amount cannot be credited directly to an NRI’s bank account. It needs to be disbursed to the seller’s or developer’s account.
The loan can be repaid using funds in the NRO/NRE account or FCNR deposits of the NRI.

Required Documentation:

There are a few legal documents that are required, so you must check these legal documents before buying a property.
As an NRI, you must submit your Indian passport and visa, work permit of the country of residence, payslip for the last six months, and income tax returns.
Property-specific documents such as the NOC from society, a title deed, RERA registration, and so on are to be submitted too.

Power of Attorney:

NRI can transfer power of attorney to their relatives or friends to complete the process of buying property in India.
A power of attorney can be a set of specific or general rights for your representative to exercise.
To execute a transaction of the property, you will need a special power of attorney, which has to be registered and notarised.

NRE and NRO accounts:

It is a must for an NRI to maintain Non-Resident External (NRE) and Non-Resident Ordinary (NRO) accounts in India.
NRE account helps NRIs to transfer foreign income to India. The interest you earn is tax-free.
While an NRO account is used to manage your Indian income sources, you can also transfer foreign currencies to this account to fund buying properties in India.

Best place to buy property in India

Best place to buy property in India:

If you are wondering which city to invest your money in, it’s always best to invest in metropolitan cities that have been developed or are developing at a steady pace.
Finding the real estate builders will be easy in India if you zero out on the city.

Here is the list of cosmopolitan cities with excellent Infrastructure.

  • Hyderabad
  • Bangalore
  • Mumbai
  • Pune

You can also invest in weekend homes and service homes as they will get you extra income, and such homes are trending over the real-estate market.

People are buying apartments as investments to get additional income and to gain assets. With quite a lot of people moving to urban cities for better IT jobs, rentals have been in demand for IT professionals.

You can also buy simple house designs in hill stations that will attract tourists while on vacation.

Here is a list of the best Hill Stations in India.

  • Manali
  • Shimla
  • Mussoorie
  • Ooty
  • Coorg
  • Munnar
  • Mahabaleshwar
  • Wayanad

Post-pandemic, there has been a rise in the real estate industry for luxury homes and villas in Hyderabad. Check out the best places to buy villas in Hyderabad if you plan to buy a luxury villa for your family in Hyderabad.

Frequently Asked Questions (FAQs):

  1. Can NRIs buy property in India?
    Answer: Yes, as an NRI, you can buy commercial, residential, or agricultural properties in India.
  2. Can NRIs buy agricultural land in India?
    Answer: Yes, NRIs can purchase agricultural land in India by acquiring permission from the Reserve Bank of India. (RBI)
  3. What is the tax on NRI buying property In India?
    Answer: When an NRI wants to sell the property, the buyer must deduct TDS at 20.6%. If the property has been sold within two years of the prior purchase, a TDS of 30.9% will be applicable.


Buying a property is an emotional event in everyone’s life. Though a very tiring process, the fruit it bears is very satisfactory and pleasant. Relive the memories of the childhood that made it worth the while. If you are an NRI buying property in India, ensure you know the process to avoid obstacles in buying land in India.

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