NRIs who have bought real estate in their home country often don’t know how good it is, how well it has been approved, or how well it has been paid for.
Investing in real estate has always been a big deal for Non-Resident Indians (NRIs). It’s always been a big part of their portfolios. Even though real estate is a good investment class because its tangible, rents grow over time. They can be used as a second home, and there are some problems with the investment process.
Here are some things that NRIs who want to invest in their home country should keep in mind:
The legal issues
The real estate market in India is still primarily unorganised. There are different laws and rules in other states.
For one thing, the Foreign Exchange Management Act (FEMA), which governs NRI investments, changes a lot. Second, NRIs and PIOs (People of Indian Origin) can’t buy agricultural land, like farmland or plantation property. Also, they need to know the small print about taxes and how the money will be sent back home.
Real estate experts need guidance to ensure there aren’t any gaps in the property selection and that the buying process isn’t full of risks.
People who don’t belong there:
It’s almost impossible for NRIs to keep an eye on their homes. The risk of encroachment or illegal possession is very high. Property guardians, who are usually the owners’ friends and relatives, have difficulty evicting people who aren’t supposed to be there.
Because there are so many important things at stake, all of the legal documents must be signed by the tenants, and all transactions must be recorded and executed correctly before the property is given over.
Many projects have been put on hold because of construction violations, a lack of money, and legal issues. On the other hand, NRIs end up losing a lot of money. Not only does the person have to wait to get their hands on the money, but their overall investment portfolio suffers as a result.
Buyers have even more problems because they don’t know about the quality and authenticity of legal documents and don’t know about the property’s approval and financial status. Failure to stay up to date on the construction progress puts them at risk, too.
The role of RERA (Real Estate Regulatory Authority) should be talked about here.
RERA does have a way to protect homebuyers’ rights and make project information clear. Investors can get all the information they need from RERA, but the body doesn’t do its due diligence. RERA wants to make the real estate market more open.
Investors are responsible for ensuring that the developers have a good history and that the property is in good financial and physical shape.
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