Can Foreigners Buy Property in India? Rules and Process Explained

Foreign nationals looking to buy property in India have to abide by certain obligations and regulations. While buying a property directly is not possible for foreigners, there are, luckily, certain exceptions.

This blog helps you discover the rules, exceptions, don’ts, and processes for buying property in India as a foreigner. A key note to remember is to stay updated with government regulations and seek legal help. If you are not able to buy a property, then make an investment and reach your goal.

Can foreigners buy property in India? What will be the process?

As a foreigner buying property in India, it may be a roller coaster ride. However, there are few ways in which foreigners can buy property in India.

In general, foreigners on tourist visas and foreigners living outside India cannot buy property in India. But there are a few exclusions.

Resident Foreigners

If you are a foreigner who is on a long-term visa and has spent around 180 days residing in India annually, then you are eligible to buy a property in the country.

Officials can purchase property in India. For other foreigners, there is one restriction. They can purchase the property from an Indian resident but will face difficulty selling it.

Non-Resident Foreigners

Foreigners who don’t hold citizenship in India cannot buy property in India unless they are an NRI or a person of Indian origin. Non-resident foreigners are people who don’t stay in India and are restricted from purchasing any property in India.

Exclusion

Non-resident India

NRIs can purchase any type of property in India freely with no restrictions. However, they cannot buy agricultural properties, plantations, or farmhouses.

Persons of Indian Origin

PIOs enjoy all the rights that a NRI has related to buying properties.

The Process of Buying Property in India as an NRI/PIOs/Foreigner/and Long-term Visa Holders

As mentioned above, only PIOs and NRIs are eligible to purchase property in India. Additionally, other foreigners who have the privilege of long-term visas and have settled in the country for one hundred and eighty days can purchase property in India.

Seek a lawyer.

Make sure to seek out a lawyer after researching. Look for a local lawyer in the area of the property who is aware of international property policies and state regulations. Make sure you have legal navigation throughout the process.

Get the legal documents.

The legal documents include a PAN card, bank statement, PIO card, passport, passport-size photocopies, present address proof, tax proof, and housing society agreement (if applicable).

Property picking and negotiation

Research the value of the property of interest and negotiate the price. Make sure you tag an attorney or some local friend you trust.

Verification of the Title Deed

The title deed should be carefully verified to prevent any obstacles during the purchase. Your lawyer will take care of the verification process.

Agreement of Sale

Once the terms and conditions are revised and concluded by both parties, the lawyer will work on the outline regarding the details of the purchase and payment schedule.

Payment

According to the regulations of the RBI, the funds for an NRI to purchase the property must be transferred from the NRI’s authorized banking channels.

Registration

Once the payment is completed, the registration process will be carried out in the local sub-registrar’s office. There is a registration charge, and stamp duty has to be paid.

Possession

After registering the sale agreement, the property is now yours.

This is the general process for a foreigner to buy property in India.

Types of Property Restricted for Foreigners

Foreigners cannot buy three types of property in India. These are plantations, farming houses, and agricultural properties.

Agricultural property

Agricultural properties include the soil that is used for the cultivation of fruits, vegetables, crops, and other products. It is restricted for foreigners to buy agricultural properties.

Plantation

Plantations, including tea, coffee, chocolate, rubber, and other plantation products, cannot be purchased by foreigners.

Farmhouses

Farmhouses are properties that are used for rearing cattle or allied activities. Foreigners cannot buy these properties.

You can also check with real estate lawyers and look up the Foreign Exchange Management Act to understand the regulations.

Exceptions for NRI/PIOs/Foreigner/and Long-term Visa Holders for Purchasing Property

The exceptions to purchasing property as a foreigner in India include:

Long-term visa residents

Residents staying in India for more than 180 days can get a residential property by obtaining approval from the government.

Inheritance

Foreigners can purchase and inherit property from an Indian citizen if possible. However, there are certain complications when selling the property.

Diplomatic Status

Under unique, well-sorted guidelines, diplomats and particular foreign officials can buy property for personal use in India.

NRIs and PIOs

NRIs and PIOs can purchase property seamlessly, except agricultural, plantation, and farmhouse property.

Benefits of Investing in Indian Real Estate for Foreigners

As a foreigner, there may be several obligations when purchasing a physical property. However, investing in real estate can benefit you in the long run.

The Indian real estate market can help you increase portfolio diversification, have a high capital appreciation, friendly government policies, fast urbanization, simple taxation procedures, and a stable policy environment for foreigners. Hence, it is suggested that foreigners invest in real estate.

Conclusion

In the end, foreigners who are not PIOs and NRIs cannot directly purchase property in India. However, NRIs and PIOs also have certain obligations and rules to follow when purchasing a property. It is important to seek help from a legal advisor and move forward with the procedure. Investing in real estate can be beneficial, as it helps in the long run.