How can NRI Buy Property in India
19 Sep 2025

How can NRI Buy Property in India

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Are you an NRI buying property in India? Find Useful tips on property investments in India in this article.

Key Takeaways

  • As an NRI, you can buy commercial or real estate properties in India.
  • You must provide a Notarised PoA for property purchase.
  • You must pay the applicable property tax in India
  • You are eligible to receive tax benefits on your real estate investments.
  • You can avail of loans through NRE or NRO accounts and repay EMIs in INR.

As an NRI, you may be living abroad but may plan to return to India in your golden years. To this end, you may decide to buy a property in India. The good news is that you can buy residential and commercial properties in India and also qualify for home loans. This article explains all about NRI property investments, including how NRIs can buy property in India.

Can an NRI take loans to buy Property?

As mentioned earlier, you can buy a property in India by taking out a home loan from an Indian bank. The bank sanctions the loan in Indian currency, and you must repay it in INR as well. The lender credits the loan amount directly into the account of the seller or property developer and not into your bank account. You can easily repay the loan EMIs through either an NRO or an NRE account or even through FNCR deposits.

Types of Properties NRIs can Purchase in India

The Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2018 allow Non-Resident Indians (NRIs) to invest in Indian real estate. Buying property in India as an NRI is permitted for both residential and commercial purposes, with certain restrictions:

Residential Property

NRIs can purchase apartments, flats, and houses for personal use or rental income. There is no limit on the number of residential properties an NRI can own.

Commercial Property

NRIs can invest in offices, shops, or commercial complexes for business or leasing purposes.

Restricted Property

Non-Resident Indians (NRIs) are not permitted to purchase the following types of property in India:

  • Agricultural land
  • Farmhouses
  • Plantation property
  • Properties intended for agricultural activity

Funding the Purchase

When NRIs are buying property in India, the purchase must be funded through:

  • Funds from your NRE/NRO account
  • Inward remittances from abroad in convertible foreign currency

Repatriation of Sale Proceeds

Proceeds from the sale of property can be repatriated abroad, following RBI guidelines:

  • Up to USD 1 million per financial year for residential or commercial properties
  • Sale proceeds must be transferred through proper banking channels

NRIs must comply with RBI regulations and tax provisions under the Income Tax Act when buying property in India as an NRI.

Benefits of NRIs Buying Property in India

Investing in Indian real estate provides several advantages for NRIs, making it a preferred choice for long-term wealth management:

Wealth Creation and Appreciation

Real estate in India has historically demonstrated long-term capital appreciation, offering the potential for significant wealth growth. For those buying property in India as an NRI, this can serve as a reliable avenue for capital investment.

Rental Income

NRIs can earn a consistent income stream by leasing residential or commercial properties, enhancing their overall financial portfolio.

Diversification of Investment Portfolio

Acquiring property in India enables NRIs to diversify their investment portfolio beyond financial instruments, thereby mitigating risk and enhancing returns.

Maintaining Personal and Family Ties

Ownership of property in India facilitates a continued personal and familial connection to the country, providing accommodation during visits and strengthening long-term familial bonds.

Repatriation Benefits

In accordance with RBI guidelines, NRIs may repatriate the proceeds from the sale of property, up to USD 1 million per financial year, ensuring the efficient movement of funds internationally.

Loan Facilities for NRIs

NRIs are eligible for home loans from Indian banks, often at competitive interest rates, which can assist in financing property acquisitions. This makes it easier for those considering can NRI buy property in India to proceed with confidence.

Key Requirements for Purchase of Property by an NRI in India

When buying property in India as an NRI, it is essential to meet certain regulatory, financial, and documentation requirements. Understanding these key requirements ensures a smooth and compliant property acquisition process.

Documentation required for buying property in India

When buying property in India as an NRI, you are required to submit several mandatory documents, which typically include:

  • A valid Indian passport
  • Current visa and/or work permit of your country of residence
  • Latest income tax returns
  • Payslips for the last six months

In addition, property-specific documents must also be provided, such as:

  • Title deed of the property
  • No Objection Certificate (NOC) from the housing society or relevant authority
  • Any other documents as required by the seller or local regulations

These documents ensure compliance with RBI regulations and facilitate a smooth property transaction for NRIs.

Special Power of Attorney

To give someone Power of Attorney means to provide them with authority on your behalf to carry out the property deal in India while you are based abroad. You must ensure you get the Power of Authority (PoA) document notarised so that there are no hassles in the property purchasing process. PoA is especially necessary if you are funding your property purchase through a Home Loan since most lenders insist on it. You must assign the PoA a Resident Indian citizen.

NRE and NRO accounts

If you are an NRI, you will ideally need to maintain NRE and NRO accounts in India(2). The NRE account (Non-Resident External) enables you to transfer foreign income in India. The interest income you earn on it is tax-free. The NRO Account (Non-Resident Ordinary) is one through which you can manage your Indian income sources. You may transfer foreign currencies in this account too to finance your property purchase plans in India.

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Step-by-Step Guide for NRI Buying Property in India

Purchasing property in India as an NRI requires careful planning and proper documentation. An NRI savings account is essential for funding and smooth transactions.

  1. Step 1: Verify Eligibility
    NRIs can buy residential and commercial properties but cannot purchase agricultural land, plantations, or farmhouses.
  2. Step 2: Select Property
    Choose based on purpose, whether personal use, rental income, or investment, and check the legal status.
  3. Step 3: Arrange Funding
    Use funds from your NRE/NRO account or inward remittances. An NRI savings account ensures smooth payments and repatriation.
  4. Step 4: Submit Documentation
    Provide passport, visa, work permit, latest tax returns, payslips, and property-specific documents such as title deed and NOC.
  5. Step 5: Complete Sale and Registration
    Sign the sale agreement, pay stamp duty, and register the property with the local sub-registrar.
  6. Step 6: Repatriation and Management
    Follow RBI guidelines for repatriation up to USD 1 million per year and consider property management if residing abroad.

Taxation on NRI properties in India

When NRI buying property in India, you must pay applicable property taxes, along with stamp duty and registration fees. An NRI savings account can simplify payments and manage financial transactions efficiently.

Loan Component

Maximum Deduction per Year

Principal Repayment

INR 150,000

Interest Payment

INR 200,000

Interest Payment

INR 200,000

Investing in property in India can be a strong long-term strategy. It provides not only a place to live but also a valuable asset for securing your financial future. If purchasing through a loan, ensure that you meet your lender’s eligibility criteria and follow the prescribed process carefully.

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Conclusion

For those considering can NRI buy property in India, investing in real estate offers an opportunity to grow long-term wealth, earn rental income, and maintain a connection to the country. An NRI savings account with DBS Treasures supports seamless transactions and ensures compliance with regulations.

By following proper documentation and taxation guidelines and utilising available tax benefits, property buyers can make informed and secure investments that protect their financial future.