Did you know that real estate investments in India have touched more than $10 billion (Rs.73,000 crore) so far in FY19 fiscal year? This is far more than $8.9 billion invested in fiscal year FY18. The depreciation of the rupee against the dollar has led to this real estate explosion. However, not every NRI is lucky to get a trustworthy agent or agency to cut the deal for them.
Mr Rao (Name changed) is a software engineer working for one of the most reputed IT companies in the world. During his recent visit, he decided to purchase a second property in India. He went through a couple of properties along with his friend and a real estate agent and invested in a very lucrative property from a reputed builder at a lower cost.
However, once he paid the funds and got his title deed, he realised the possession documents were forged. Someone else had also got the same property deed and now there were two owners of the same property!
All this could have been stopped, and Mr Rao would not have lost an exorbitant amount too, only if he had done his groundwork before investing.
He feels cheated and is now fighting the possession battle in court, with the real estate agent gone awry.
He is one of the many NRIs who are duped every year into buying properties because of their glamour and end up with nothing or delayed/duplicate possession.
How do you actually purchase a property in India without worrying?
One of the foremost considerations before purchasing a property in India is to learn about is the financial landscape. If you are an NRI exploring the option of investing in India, there are a few key points that you need to keep in mind-
Know your Rights
All real estate dealings or foreign investments are governed by one centralized act-Foreign Exchange Management Act (FEMA). According to the rule, any NRI having an Indian passport can invest in commercial or residential property in India. However, one cannot purchase farmhouse or farmland properties, agricultural land, or plantation property.
As your trusted partner, we have onboard the best due diligence professionals on the platform to help you to verify if your property does not come under any of these categories, to make the transaction as smooth as possible.
There is a list of documentation that is mandatory for every NRI to possess in order to purchase a property in India.
A legal requirement is having an NRI account in any authorised Indian bank.
An authorised PAN card and Indian Passport are mandatory.
Having a Power of Attorney Certificate helps NRIs to avoid travelling back and forth from their country to India for all formalities.
Documentation of the property
Clearance of title deed in original along with a history of deals on the land.
Check the hindrance certificate that is like a no-dues certificate issued by the local development authority.
In case of a property mortgage, a no-dues certificate from the bank.
A verified layout of the flat and property, like a blueprint, to know the exact location of the flat.
Various no-objection certificates (NOC) from the local municipal corporation, fire department, electricity department, water and sewage department, water supply approval, public health services department, and pollution control board.
Do not complete a payment upfront without verifying the actual possession of the property. It is advisable to disburse the payment in different stages, once the property crosses every stage that has been promised. Clearly speak with the property owner for a constructive payment plan.
Consider taking help from professional investigative agencies to dig deep into every aspect of the project before investing. They will present you with a complete factsheet without you moving out of your house.
Right from the financial standing of the builder to previous projects details, possession details, documentation verification, and so on, can be collected diligently by your real estate investigator to help you have a seamless property buying experience in India.