An estimated 25 million overseas NRIs living in 130 countries are nowadays remitting billions of dollars back home. Net inflows from NRIs have witnessed over twenty-fold rise to $4 billion in the fiscal 2009. A portion of this goes into real estate ever since liberalization of rules by the government on NRI/PIO investments in real estate.
It is not only the easing of investment norms but the tax advantages that accrue to an investor that is driving more investments towards real estate back home. Moreover, among the five million NRIs living in
West Asia are many keen to invest in real estate here as expatriate investments in countries like Dubai took a fall recently. Similarly, not all NRIs can afford to invest in overseas properties due to very high costs, and the high cost of managing them.
Property shows held at periodical intervals in select countries do provide an opportunity for NRIs to directly interact with the developers. A number of overseas representative offices set up by banks enable NRIs to seek home loans for investments in real estate in India. Even select foreign banks in the private sector provide home and mortgage loans to NRIs .The rules governing NRI investments are the
There are no restrictions on the number of residential /commercial properties purchased in India but repatriation is restricted to two residential units after a lockin period of three years. Rental income is repatriable. Thus, a number of NRIs have shown interest in leased properties across the country. Similarly, NRIs may transfer by way of gift, residential /commercial property in India to a person resident in India or to an NRI/PIO. Proceeds of residential /commercial property received by way of gift should be credited to a NRO account only. As regards repatriation, an amount not exceeding $1 million per calendar year is allowed subject to production of documentary evidence in support of inheritance and tax clearance certificate/no objection certificate from the income tax authority to authorized dealer for remittances.
The CBDT has recently notified that any gift-in-kind, being an immovable property or any other property, the value of which exceeds Rs 50,000 will become taxable in the hands of the donee, being an individual or a HUF, as income from other sources.
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