Buying a property in India is an amazing experience both financially and emotionally. It is the biggest investment of one’s life that involves serious thinking and planning. With several possible difficulties in the way like inexperienced brokers, legal complications, financing burden, it becomes an overall tough and complicated task. So it is very important that the entire process should be carried out systematically to make the experience hassle free.
With the falling of the Indian rupee, NRI investments in India are increasing as the property in India has become an attractive proposition for non-residential Indians (NRIs). The RBI regulations are also very relaxed for buying apartments in India as the potential home buyers need not take any kind for prior approvals for the same. For FEMA purposes, Indian Citizens who have become NRIs, can purchase immovable properties situated in the country without taking any specific permission from RBI. However this doesn’t apply for any kind of plantation property or agricultural land or a farm house because these properties can either be inherited or gifted.
Also the entire financial transaction for any such deal has to be made in Indian rupees (INR) via an NRI account in any normal bank and not through foreign currency or traveller’s cheques. The property purchased can be paid via remittances from abroad through banks or from the money reserved in the NRE/NRO accounts.
Here we have chalked out a list of steps as a guideline for anybody and everybody planning to buy a property in India. These steps if followed religiously can also ease out the difficulties involved in NRI investments in India and help make you the proud owner of sophisticated abodes.
Setting up a comfortable budget: Fixing off the budget depends upon your monthly income and expenditure and calculations of how you are comfortably going to pay off the installments every month. The down payment needs to given from the savings account which has to be further managed thoughtfully.
Comparative analysis of the various lending institutions, in terms of costs mentioned and interest rates and deciding on any amongst them that offers the best deal.
In case of NRI investments in India, RBI has allowed certain registered Housing Finance Companies (HFC’s) and banks to grant home loans to NRI’s to buy residential property here. These loans shall be approved on the similar criteria as those granted to Indian residents with loan amount calculated on the basis of income, tenure and the extent to which the lenders can approve loans to an NRI. These loans need to repaid in Indian Rupees only and shall be disbursed to the seller or developer rather than directly crediting into the NRI’s account. The rental income received from such properties can also be used to pay off the EMI’s.
Finalize the property you wish to buy. The house selected should be favorable in terms of locality, neighborhood, facilities, layout, number of rooms, size of rooms and features such that it meets your requirement of an ideal dream home. While doing so, you can even maintain a checklist of the things you like/ dislike in particular properties seen and can evaluate later on.
Negotiations: You can negotiate with the developer on the cost factor till the time both the parties agree to the terms and conditions of the deal.
Inspection: It is very important to get a final inspection and due diligence checks done of the property you wish to purchase in order to confirm that the house does not require any major renovations or repair work and is in a livable condition.
Home owner’s insurance: Before finally buying the house, you can even look for the home insurance options offered by various insurance companies. After all the security of your biggest asset of life is of utmost importance and is an expense that cannot be ignored for a safe future.
Possession and Registration: This is the final step of the buying process as it transfers the property in your name and now you need to get it registered. Possession involves the physical transfer of the house it is incomplete without getting the same registered in your name in the local municipal records.
Finally the house is yours. Put your best step forward. Most of the people find house buying a demanding task but at the end of it, having your own home sweet home gives a paramount satisfaction.