Non-Resident Indians (NRIs) have been investing in the real estate sector for a long time now, especially in the metropolitan cities New Delhi, Mumbai and Bangalore. This type of asset has been profitable for various states of India. Kerala is also one such state. After LPG (Liberalization, Privatization and Globalization) measure in 1991, there have been lots of variations in the legal aspect and guidelines regulating the investment processes for the NRIs. Here in our country, the NRIs are eligible to invest in residential and commercial areas as well. The guidelines managing the dealings of real estate are regulated by FEMA (Foreign Exchange Management Act).
NRIs are permitted to purchase or lease properties in India and they can also transfer the proceeds to bank accounts that are lawfully permitted by the Indian government. NRIs are also entitled to obtain home loans for the purpose of purchasing assets from various Indian banks. If you want to know more about such loans, then you should research and look up the available loans. The interest which is appropriate to any Indian borrower (part of the QIB) is valid to the NRIs as well. NRIs can also reimburse their loan with the lease they get from their asset or property. NRIs also have the option of saving the remaining part of their profits in an NRO or NRE or FCNR (B). NRIs consider buying flats and villas in Kerala for investment purposes.
This is a comprehensive guide for NRIs to real estate investment in Kerala.
Do your research well:
This is the first step towards making any real estate investment in any state of India. There are different types of investments in this sector. But, not every type of investment is valid for your particular need. Firstly, the NRI must choose their chief aim behind their investment and also decide what will be the period of this particular investment. For some short term goals, you should purchase apartments like 1BHKs or 2 BHKs. For any long term financial goal, you should put their money in any villas or bungalows. One good advice is that you should select those zones for purchasing or putting their money in real estate which is stable both politically and economically as well. Choosing the best home builders, especially builders in Kerala can help you get luxury properties in prime locations of Kerala.
Create a proper bank account:
NRIs need to open a separate NRO or NRE bank account for saving the profits made through the lease of the property. This bank account can be used to repay the loans as well which you have availed when purchasing their home or any property or piece of land on which you want to construct their house.
Hire a lawyer:
The NRI who is keen to invest his money in the real estate sector must approach a good and reputed lawyer who is also a local to the cities, towns or district in Kerala. The sector of Real estate is such a different kind of investment that contains a lot of legalities and legal know-how. Such processes usually begin right from the procurement of the piece of land or property. It should also be advised to appoint a number of lawyers so that you could investigate and find out about the location where the property is situated and the NRI wants to make an investment. In this way, many of the lawful measures could be taken and handled with caution, right from the beginning.
Obtaining RBI approval:
NRIs must perform as per the guidelines stated by the Reserve Bank of India. In some circumstances concerning investment, NRIs are not obligated to notify the Reserve Bank of India in the early phase. But, it is unavoidable to monitor the instructions of the Reserve Bank of India. Also, on another hand, various types of investments in the real estate sector are entirely barred by the Reserve Bank of India. Some types of investments necessitate the previous sanction of the Reserve Bank of India and in such circumstances, the NRI must not start attaining proceeds from their real estate investment except when the essential official papers are yielded to the Reserve Bank and those particular authorities of the Reserve Bank accept the papers. There is a long list of paperwork that the NRI should possess before he applies for the sanction. Each NRI must get advice from his lawyer, make those documents and then submit them accordingly.
Acquire information and pay the Income-tax:
Simply, like all Indian citizens living in Kerala, NRIs who want to purchase and invest in the real estate sector in the State of Kerala must pay their appropriate income tax. There are a few classifications of income in which you can obtain some tax reductions. These areas might be made use of by the NRIs as it is done by the people of the state of Kerala.
Information about properties still under construction:
The NRIs can purchase or invest in buildings that are still under construction. But, almost all the agreements of under-construction properties, as we might suggest, should be done by hiring a lawyer and an Indian representative as well. This representative should be carefully chosen at the commencement of the purchase. It is also prudent to keep a representative who is local.
To close this up, real estate investment are full of prospects. This is the intention due to which multiple businessmen are involved in the Real estate investment in Kerala. Unnecessary to say, that NRIs will be fascinated in this lucrative investment. With the best builders, NRIs can choose the best house for sale in Palakkad or Thrissur or Kochi as per their choice. In the early stages of your respective investments, you should keep themselves limited to short term monetary advance and similar kind of asset. Ultimately, you will get sufficient familiarity to enlarge your asset strategies into numerous types of real estate possessions. All being well, the discussed guidelines will be useful for NRIs interested in real estate investments.