An NRI is any citizen of India who is not residing in India and has resided in India for less than 182 days in the preceding financial year. NRIs have professional or other commitments which require them to live outside India for an indefinite period of time. However, NRIs still have opportunities to buy real estate in India.

A PIO is any citizen not of Pakistan or Bangladesh who has:

• At any time held an Indian passport

• Parents or grandparents who are citizens of India according to the Indian Constitution

• A spouse who is an Indian citizen or PIO (for the purpose of bank deposits)

A PIO can also buy real estate in India, and invest in Indian properties.

An OCI is a person who is a citizen of another country, but also:

• Held an Indian citizenship at some point

• Was eligible for an Indian citizenship at the time of the commencement of the Indian Constitution

• Belongs to a territory that became part of India after Independence

With NRI investment in India growing at a large rate, an OCI can also buy real estate in India.

According to guidelines laid down by the RBI, the following can purchase property in India:

• A Non-Resident Indian (NRI)

• A PIO

• An OCI

All three categories are generally referred to as NRIs for the purpose of opening bank accounts, for bank deposits, for purchasing property, etc. NRI investment in India shows great potential, and any of the aforementioned can buy real estate in India.

The RBI allows NRIs to purchase immovable property in India including:

• Residential property

• Commercial assets

However, NRIs are forbidden from purchasing:

• Agricultural land

• Plantations

• Farmhouses

If you are looking for NRI investment in India and want to purchase one of these, you will need to specially apply to the RBI for permission and your case will be considered separately.

While presenting documents to buy real estate in India, NRIs fall under two categories: salaried individuals and self-employed individuals.

Salaried NRIs looking to invest and buy real estate in India should have the following documents:

• Indian passport

• PIO card/OCI card (if applicable)

• PAN card

• Power of attorney documents

• Latest salary pay slips for the past 6 months

• Income tax returns for the last 2 years

• Copy of employment contract

• Appointment letter (if applicable)

• Work permit (if applicable)

• Bank statement for the past 1 year from external bank account

• Bank statement for the last 1 year from Non-Resident External (NRE)/Non-Resident Ordinary (NRO) account

• Address proof

• Credit report

• Property related documents

NRIs who are self-employed individuals looking to buy real estate in India should have the following documents:

• Passport

• PIO/OCI card (if applicable)

• Balance sheet of company for the last 3 years

• Profit and loss accounts for the last 3 years

• Bank account statement of individual account for the last 6 months

• Bank account statement of company account for the last 6 months

• Income tax returns from the last 3 years

• Address proof

• Power of attorney documents

• Credit reports

• Property-related documents

Anybody who wants to make an NRI investment in India should possess the following documents:

• Title Deed

• Authorized building plan

• NOC from Electricity Supply, Pollution Control Board, Water Department

• Sale agreement between builder and previous owner (if applicable)

• Possession letter from the builder

• Sale agreement

• Khata certificate and extracts

• Allotment letter

• Possession letter

• Encumbrance certificate (in case of there being a previous buyer)

• Occupancy certificate

For more details, read our article on Mandatory Documents NRIs Need While Investing in Indian Realty.

NRIs who want to buy real estate in India need to appoint a power of attorney who can act on their behalf.

There are three types of PoA’s for NRI investment in India:

• A Special PoA has only limited powers, usually restricted to a particular kind of transaction.

• A General PoA can act on behalf of an individual for a wide range of transactions without any limitations.

• A Durable PoA has lifetime powers and can even make decisions for an individual when they’re incapacitated.

With regard to real estate for NRI investment in India, a PoA can:

• Mortgage, exchange, sell, lease, collect rent on behalf of an individual

• Manage and settle any disputes which arise

• Perform acts required by banks and insurance companies and enter into contracts, deal with bonds, sign documents, etc.

The following steps need to be completed to grant someone PoA status:

• Draft the PoA agreement on non-judicial stamp paper

• Visit Sub-Registrar’s office with legal representative and two witnesses

• Carry ID proof, two passport size photographs, copy of PoA agreement along with original

• Signatures, photographs and fingerprints of both parties will be collected

• Visit Sub-Registrar’s office again to collect registered PoA agreement once it’s completed

If you are an NRI looking to buy real estate in India, loans can be made available. Here are the guidelines to follow for home loans that cater to NRI investment in India:

• Period of repayment and amount given as loan shall be decided by the bank providing the loan

• Rate of interest is decided by the RBI or National Housing Bank

• The loan amount will not be credit to the NRE/Foreign Currency Non-Resident (FCNR)/Non-Resident Non-Repatriable (NRNR) account

• Loan installments will be paid through normal banking channels

Here are the documents needed for home loans that cater to NRI investment in India:

• Copy of passport

• Copy of work visa

• Address proof (utility bill, bank statement, lease agreement)

• Salary statement for the last 6 months

• NRE/NRO bank account statement for the last 6 months

• Power of attorney documents

• 2 passport size photographs

• Copy of PAN card

• List of documents for salaried/self-employed individuals as well