The Indian real estate scenario has always been rock solid and even during the periods of economic meltdown, the least effected industry has been the realty sector. And its eligibility as a great cash cow hasn’t escaped the discerning eye of the NRIs (Non-resident Indians) either and they are more than ready to invest in Indian properties today. However, some doubts remain on the norms for NRI investment into the Indian scenario.

Thanks to the introduction of new rules and regulations, the process of buying property by NRIs has now been made easier. Here are some details:

Regulatory Act:

As long as you own a valid Indian passport, you don’t require any permission to invest in India. Property investments by NRIs have been greatly simplified by the RBI and are governed by the rules under FEMA (Foreign Exchange Management Act).

Types of Properties:

There are no limitations to the number of properties that an NRI or a Person of Indian Origin (PIO) can invest in; these can be either residential or commercial in nature. However, do note that an NRI cannot invest in agricultural land, farmhouse or plantations in India – unless they are gifted to the NRI.


For an NRI to invest in India, it’s essential he has an authorized bank account in India as all transactions needed for property investment need to be done in Indian currency only. All financial transactions need to be carried out through an NRE, NRO or an FCNR (Foreign Currency Non-Resident) account.

What’s more, an NRI is even eligible for some home loan schemes where the bank can finance up to 80% of the cost of the said property while the NRI chips in the remaining 20% of the value. Before investing in any property, ensure that your transaction paperwork is clean and that there are no pending bills with any authority. Better still, take a ‘No-dues’ certificate from the property seller to keep the title deed clear.

Tax Benefits:

As an NRI, you are entitled to the same tax benefits as a resident Indian and can claim up to 1 lakh in returns under section 80 C of the Income Tax Act, 1961. However, if you sell off the property within three years of purchasing, the profits generated come under short-term capital gains and become taxable.

Power Of Attorney:

When investing in property, especially an ongoing project, it’s safer to give the power of attorney to a trusted person available on the ground to take care of things in your absence – and keep your investment secure.