• What should one consider while purchasing a residential flat?
  Evaluating a property option can be a mind-boggling exercise. Some of the points one should consider while purchasing a flat:
  • The locality & proximity distances to public transport, schools/colleges, hospitals, market, business district, entertainment centres, restaurants.
  • Area of the flat i.e. Carpet Area, Built-up Area and Super Built Up Area.
    • Carpet Area: The area of an apartment or building, not inclusive of the area of the walls is known as carpet area. This is the area that is actually used and in which a carpet can be laid.
    • Built-up Area: When the area of the walls including the balcony is calculated along with the carpet area, it is known as built-up area.
    • Super Built-up Area: The built-up area along with the area under common spaces like lobby, lifts, stairs, garden and swimming pool is called super built-up area.
  • Car parking for self and visitors.
  • Quality of construction.
  • Reputation of the builder or seller.
  • Supply of water, power and availability of other basic utilities.
  • Hidden cost components: stamp duty, registration charges, transfer fees, monthly outgoings and society charges.
  • Potential for resale or renting out of the property.
  • Any other distinguishing features or advantages of the property.

• What should one consider to verify the legal compliance have been fulfilled by the builder?
  • Check for the market trends about prevalent rates in the vicinity and last known transactions. This would help you in judging the price range.
  • Seek photocopies of the deeds of title related to the property to be purchased. Examine the deeds to establish the ownership of the property by seller, preferably through an advocate. Ascertain the survey number, village and registration district of the property as these details are required for registration of the sale. Previous encumbrances and loans, if any on the property must be cleared before completion of purchase of the property. The title of the Vendor to the property must be clear and marketable.
  • Check for approved layout plan and approved building plan with number of floors.
  • Check for certificates that signify clearance from Municipality, Electricity, Water, Pollution, Lift authorities.
  • Confirm transfer fees, stamp duty and registration charges to be paid on purchase of the property as well as outgoings to be paid for the property i.e. property tax, water and electricity charges, society charges, maintenance charges.
  • In case purchasing a resale property, check for pending dues.

• As an NRI, do I need any approval from the Reserve Bank of India to purchase a property in India?
  No. The Government of India has granted general permission for an NRI to buy property in India except for agricultural land, plantation property or farmhouse.

• In what manner should the purchase consideration for the property be paid?
  The purchase consideration can be paid either in form of inward remittances in foreign exchange through normal banking channels or out of funds from any non resident accounts maintained with banks in India.

• Is there any uppermost limit to the number of residential properties that may be purchased by an NRI?
  No, there is no limit on the number of residential properties that may be bought by an NRI. However, repatriation is allowed only in respect of two such properties.

• As an NRI, can I sell my property; does it need any approval from RBI?
  Yes, as an NRI you can sell your property. RBI has granted general permission for sale of such property. However, where another foreign citizen of Indian origin purchases the property, funds towards the purchase consideration should either be remitted to India or paid out of balances in non-resident accounts maintained with banks in India.

• Can NRI's/PIO's rent out their properties?
  Yes, NRI/PIOs can rent out their property, either by purchase through application of forex or otherwise. However, the rental income being a current account transaction is repatriable outside India only if proper tax is paid.

• Are there any guidelines for loans to NRI's/PIO's?
  Yes, there are guidelines issued by the by the Reserve Bank of India for home loans issued to NRIs. These are:
  • The loan amount shall not exceed 85% of the cost of the dwelling unit.
  • Own contribution, which is the cost of dwelling unit financed less the loan amount, can be met from direct remittances from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India.
  • Repayment of the loan, comprising of the principal and interest including all the charges are to be remitted from abroad only through normal banking channels, your Non-Resident (External) [NR (E)] Account and /or Non-Resident (Ordinary) [NR (O)] account and /or Non-Resident Special Rupee account [NRSR] in India.

• List of documents to be submitted along with the loan application?
  The following documents are to be submitted along with the loan application:
  • Photocopy of the labour contract and English translation duly countersigned by your employer.
  • Latest salary certificate (in English) specifying the following:
    • Name (as it appears in the passport)
    • Date of joining
    • Passport Number
    • Designation
    • Perquisites and salary
  • Photocopy of labour card/identity card.
  • Photocopy of valid resident visa stamped on the passport.
  • Photocopy of monthly statement of local bank account for the last 4 months.
  • Property related documents.