For an NRI investor interested in buying or selling property in India, understanding the intricacies of property transactions in India is important, but without the correct documentation, you’d be faced with unnecessary delays in executing it.Let’s take a look at the documents needed by buyers and sellers of property in India to ensure the transactions are carried out without a hitch.Checklist Of Documents Needed By Buyers And Sellers of Property In India Documents Needed To Be Produced By The Buyer:With the introduction of RERA, there is increased emphasis on transparency and accountability in real estate transactions.

It is important to note, that NRIs are often confused with PIOs and OCIs.A PIO (Person of Indian Origin) is an individual who:Holds the passport of any foreign country.Is a foreign citizen whose father or grandfather was a citizen of India.An OCI (Overseas Citizen of India) is an individual who:Is not a citizen of India, but eligible for citizenship (dual citizenship).Such individuals need the PIO and OCI cards respectively to purchase property in India.However, neither of them can invest in plantations, agricultural properties or farmhouses (unless they have been inherited by or gifted to them).2.

Loan Sanction Letter:NRIs are also eligible for obtaining loans for financing their property purchase like an Indian Resident.

The letter is a proof that the applicant is eligible to avail a certain amount of loan from its lender (bank or financial institution) subject to the fulfilment of certain terms and conditions as mentioned by the lender.The letter is issued only after the bank has evaluated the applicant’s credit history and other credentials based on the documents submitted along with the application.The seller can demand the loan sanction letter to be sure that the buyer will be able to pay the price of the property within the stipulated period.5.

Power Of Attorney (POA) If Needed:Most NRIs plan a visit only once all the groundwork has been completed by friends/relatives/brokers.

The representative can take decisions, to the extent mentioned in the deed, on behalf of the NRI.To understand the intricacies of executing a POA, refer to the article here.Documents The Seller Must Produce:In addition to the above fundamental documents, the NRI buyer will also need certain documents to complete the paperwork required to submit to a bank or such other authority to process his/her application for loans, as well as to establish rightful ownership over the property.The seller should provide these documents to the buyer during the course of the transaction.If an NRI intends to sell his/her property in India, he/she should ideally have all the below mentioned documents:1.

And, even if we were to remove the ‘emotions’ out of the property investments, still a property investment involves your hard-earned money and you need to be very careful about it, especially when you are a thousand miles away.Nothing is worse than the feeling of being cheated when it comes to investing in a property.For Non-Resident Indians (NRIs) there are a number of factors that affect their property investment decisions.Unlike local residents, it is not feasible for the NRIs to visit the property site frequently.

Some NRI’s face the worse when it comes to property investments because of a handful of fraudsters.The above to an extent is also true for local residents.

They simply do not have enough knowledge to safeguard their interests from developers or brokers who can take them for a ride.To find a solution to such issues related to property, for residents and even NRIs,  Real Estate Regulation and Development Act (RERA) was introduced in India.RERA was passed as an act in the year 2016 to protect home-buyers and also to boost investments in the real estate industry.The Act came into force on May 1, 2016, with 59 of 92 sections notified.

The remaining provisions, however, came into force on May 1, 2017.So how does RERA affect property investment decisions of NRI investors?In order to answer this question, first, we’ll need to understand some of the main provisions of this act.Overview of Important Provisions of RERAAccording to the act, every state and Union territory of India must have its own regulator and set of rules in order to govern the functioning of the regulator.In addition to this, a regulator of the state will be responsible to register real estate projects and real estate agents operating in their state under RERA.

The only reason that this money can be used for is the construction of the project and the cost borne towards the land.For the buyers to have more clarity, the developers will have to keep the buyers informed of their other ongoing projects.RERA also requires builders to submit the originally approved plans for their ongoing projects and the alterations that they have made later to increase the satisfaction level of the buyers.

If there is any issue in regard to construction in these five years, it is the regulator’s responsibility to have the issue rectified within 30 days.Also, developers are forbidden to invite, advertise, sell, offer, market or book any plot, apartment, house, building, investment in projects, without first registering it with the regulatory authority.

Stamp duty is generally calculated as a percentage of the higher among the circle rate and the agreement value of the concerned property.

The rate differs from state to state and depends on the following the factors:Status of the property: whether it is old or newLocation of the property: whether it is situated in a metro, a town, a rural area, etc.Age of the owner: Discounts may be provided to senior citizens (in some states)Gender of the owner: Female real estate owners could avail certain concessions (in some states)Usage of property: Whether it is a residential or a commercial propertyType of property: Whether it is an apartment or an independent houseStamp duty can be paid in the following three ways:Through non-judicial stamp paper: The agreement details are mentioned in this paper, and it is later signed by the executants.

It has to be submitted within four months at the sub-registrar’s office.By franking: The agreement is printed on plain paper and then submitted to an authorised bank, which processes the document using its franking machine.Online: In some states, the stamp duty can also be paid online, using the NEFT or RTGS.

Stamp duty charges range from 3% to 10%, based on the slabs determined by different states.Paid by:The liability to pay the stamp duty rests with the buyer of the property.

It is conducted mainly to verify the ownership of title over the property and any encumbrances over the property, so as to protect one against pre-existing claims.

It also includes a detailed search of all aspects relating to the history of that property such as the status of encumbrances over the property, the status of disputes relating to the property, the applicable regulations and the status of compliance of such applicable regulations relating to the property in question.Limited Search: Unlike full searches, in a limited search, the search relating to the history of the property may be limited to restricted aspects such as recent title history, encumbrances on the property, disputes related to the property etc.Typically, during the due diligence process, the following aspects will be examined:Legal capacity of the present owner of the property: It is important to check if the person is legally capable of entering into a binding contract for sale or lease of the property or for mortgaging the property.Nature of the current owner’s right over the property: It is necessary to identify the nature of the current owner’s right over the property and the transferability of such right.Source of right or title of the current owner: In India, a person can acquire right or title over the property by purchase, inheritance, partition, as a gift, through a will, or through perpetual lease (ongoing tenure over state land, issued for a specific purpose, and must be used only for the purpose for which it was originally issued).Legality of the construction: There are specific rules and regulations that govern the manner in which civil constructions need to be carried out in that particular State.

But, it is definitely important to know the steps involved in the process.To make it easier for an NRI investor, here’s a detailed guide outlining the process of buying and selling a property in India.Buying And Selling Property In India: Guide for an NRI InvestorBefore buying property in India, the NRI investor must first carefully consider the various factors that influence the decision such as the type of property he/she can invest in, the regulatory framework governing property transactions, available finances, tax benefits, etc.Having thought about these points, it is necessary to follow the steps below:1.

Here are a few factors you need to check:Check the sanction plan of the project and that the development is legal (compliance with RERA).Make sure that the property bye-laws are applicable in the area and that there are no violations on the seller’s part.Make sure to take NOCs (No Objection Certificates) from the concerned authorities for water and electricity.Check all dues and tax liabilities.5.

It is issued by a developer or the housing authority.7.

The stamp duty is calculated as a percentage of the higher of the following amounts:Actual price paid for the propertyCircle rate* in the area*Circle rate is the minimum value at which the sale or transfer of a plot, built-up house, apartment or a commercial property can occur.Preparing the stamp papers: Once the value of the property has been determined, the buyer must now purchase non-judicial stamp papers equivalent to the value of the stamp duty, either online or from licensed stamp vendors.Preparing the sale deed: The sale deed is prepared by an attorney on behalf of the buyer, the subject of which varies on the basis of the transaction such as the lease, mortgage, power of attorney, etc.Payment of stamp duty and registration charges: Once the stamp papers are ready, the stamp duty can be paid to the collector of stamps.

There is no need to grant a complete power of attorney – the NRI can give ‘Admit PoA’ rights to the PoA holder who will merely represent the owner in the registrar office.

According to this, the NRI should duly sign all the documents and the PoA holder will represent him in the sale registration.Once the registration is complete, the NRI should focus on the tax implications and the repatriation policies.5.

Almost all other issues and concerns that an NRI must deal with, can be derived from this fundamental problem.Let’s take a detailed look at these problems faced by NRIs when purchasing property in India.5 Problems Faced By NRIs When Buying Property In India:As much as the advent of technology has made it easier to conduct business across time zones when it comes to matters involving heavy money, nothing beats the security of proximity.

And this is primarily what plagues an NRI’s property investment in India.Here are some of the issues NRI investors have, attributable to the fundamental lack of proximity while purchasing property in India:1.

This is also a reason why NRI investors have to depend entirely on a real estate broker, or family and friends for any information on the ground reality of the property.2.

These people usually claim to be relatives or friends of the NRI owner and present forged documentation – including the Power of Attorney.4.

Lack Of Clear Titles:In many cases, the person who sells a property to an NRI provides only a photocopy of the title deed – this could either be because the property was pledged or because there are several owners.

Assured, Timely Delivery of Property:Before RERA, builders invariably failed to deliver their projects on time, because they would either divert the funds to another project, or they would sell the projects without following the necessary statutory regulations.

After all, managing a property from abroad is no cakewalk!If an NRI chooses to go ahead with his/her decision of investing in a property in India, the next step to consider is knowing some basic rules around investing in Indian property.

While there is no restriction on the number of properties an NRI can own in India, he/she cannot purchase agricultural lands, farmhouses or plantations.

The regulatory framework and instructions, however, are issued by the RBI (Reserve Bank of India).(5)3.

In case of purchase, payments can be made only out of funds received in India through normal Indian banking channels by way of inward remittances from any place outside India OR out of funds held in any Non-Resident External (NRE) account/Foreign Currency Non-Resident (FCNR) account/Non Resident Ordinary (NRO) account maintained in India.

However, the documentation process for availing these loans is different.

For example, Axis Bank demands the following documents from NRI investor looking for a home loan to purchase Indian property: (3)Full passport copy and work visa copyOverseas address proof e.g.

Many times, real estate agents are confused with property managers and vice versa.

It is true that both businesses deal with property, but that is where the similarities mostly come to a halt.So what makes a real estate agent different from a property manager?

FunctioningTo begin with, a real estate agent looks after the listing and selling of properties on behalf of the owners of the property.

Additionally, they also help the property owners to rent out their premises.

On the other hand, along with all the functions mentioned above, a property manager would also manage various other aspects of the property on behalf of owners – Beyond the simple ‘buy-sell-rent’ arrangement.So, while a real estate agent would help you let out, sell your house or buy a new one or get one on rent; a property manager will look after everything associated with your property – right from screening potential tenants to enhancing the value of your property as well as helping you decide whether to buy/sell or rent a particular property.

If your property is outside the city or even the country you live in, you can hire property managers and leave the maintenance of your home to them including the repairs, tenant issues, rent collection, regular upkeep, etc.3.