Ready for booster dose from NRIs

THE REAL estate market is slowly picking up in the holy city of Ajmer. With sentiments improving, investors as well as end users have started exploring options. Being a prominent centre of religious tourism, there is no dearth of investors from abroad. Property consultants have started getting queries from NRIs visiting the holy Dargah of Khwaja Moinuddin Chisti. Most of them want a 2-3 bedroom flat in the city so that whenever they come to pay homage at the dargah they can live comfortably. In the past few weeks, there has been some positive movement in realty space, said Blue Earth Consultant managing director Surendra Rajpurohit.
The impact of this trend is quite visible in posh localities like Vaishali Nagar and Civil Lines. Rates in these areas which were static for sometime have suddenly started witnessing some surge. A plot in Vaishali Nagar which was available at Rs 10,000 per square yard, now commands a rate of Rs 12,000 per sq yard. Similarly, a piece of land in Civil Lines which would cost Rs 9,000 per sq yard a few months back, can now fetch Rs 12000 per sq yard, says Rajeev Shikari, a property consultant.
With time, there has been a paradigm shift in preferences. Earlier there was a demand for independent houses. Now people are asking for apartments and society flats. People now prefer community living as it offers convenience, safety and common facilities. People, specially retired and nuclear families, are looking for flats, says Mr Rajpurohit. But the apartment culture is yet to take off. Not many real estate players are in the ring. Ansal Properties and Infrastructure is among the frontrunner , and is coming up with a 100-acre township Sushant City on NH-8 (connecting Jaipur to Ajmer). It will house a commercial mall Ansal Plaza, a three-screen multiplex, four different sizes of 790 residential plots, 1,200 independent houses and 225 flats. Flats are available in the range of Rs 7-15 lakh while an independent house can cost you Rs 7 lakh to Rs 60 lakh, depending on the size and construction, said Amit Bhardwaj of SM Real Estate. The affordable flats are in localities connecting Ajmer-Jaipur highway such as Jagwana , where the rates have come down from Rs 3,000 per sq yard to Rs 2,300 per sq yard. The rentals, however, are in the affordable limit as Ajmer doesnt have much of an expatriate population. A 3BHK in prime location is available on rent for Rs 5,000 while a 2BHK would cost Rs 2,500 a month, says Mr Rajpurohit.
The commercial space is also witnessing some movement. While brands and retail players are still waiting for the right time to hit the market , banks and insurance companies are going for expansion. The Ashiana Groups Oasis mall in Vaishali Nagar has provided ample commercial space in the city. Commercial rates in the city are still in the correction mode. A year ago, commercial rental rates touched Rs 50 per sqft in areas like Indian Motor Circle and areas adjoining bus stands. They have now come down to Rs 30 in the absence of takers. Its the banks and new entrant in telecom sector which are opening their offices, says Ramcharan Sindhi, a property consultant.

Spaces near the Dargah Market, Vaishali Nagar and Indian Motor Circle command premium while shops adjoining the railway station and bus stand have slightly lower rentals. A shop in Dargah market commands a rental of minimum Rs 35 per sqft while the selling price of these shops ranges from Rs 35,000-50 ,000 per sq yards, Mr Sindhi says.

Source:http://lite.epaper.timesofindia.com/getpage.aspx?edlabel=ETM&pubLabel=ET&pageid=9&mydateHid=27-09-2009

NRI home loans : Financial tools for getting homes in one’s motherland

Loans are facilitating every individual in the country, whether the person be a citizen of the country or an NRI. Loans are available to the every corner of the country, with a purpose that every one should make a healthy use of it.

Loans entails as the best friend of an individual in the present scenario. Whether the person be a citizen or an NRI in the country, loans are easily approachable services which enhance the status of individuals. In the present arena, owning a home or a car is a status symbol. Loans in India has provided an edge, which has the ability of satisfying anyone’s wishes in simple and easy steps. Presently, the NRI home loan facility is available for non-resident Indian for the purpose of acquiring a home. All financial lenders go by the NRI definition guideline given by RBI i.e. “an Indian citizen who holds a valid Indian passport and who stays abroad for employment or for carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for uncertain duration of stay abroad is an NRI.”

‘NRI’s are eligible to take residential property in India. Different banks use different criteria for lending to NRIs, including the various mandatory aspect of financial lenders as- An NRI must have an account with the lending bank. He should tend to earmark the deposit held in addition to the mortgage on the property Else all required documents are similar to those applicable to the local residential persons Non-Resident Indians (NRI) can apply for a loan for construction, renovation, alteration or repairing of a house or for purchasing a plot or house in the country. Since, the interest rate for the NRI home loans do not vary much from the the one charged for Indian citizens. But they could get their loan sanctioned for the shorter period of time. For a home loans, NRIs get only 85 per cent of cost of loan. Whereas, the loan-size depends on the refunding capacity of the borrower. The loans equivalent to 36 times of the gross monthly earning of the applicant may be issued.

On the other hand, the car loans are available for all kinds of people to satisfy their various needs with different names. Which could be auto loans bad credit, fast auto loans, logbook loans, auto loan after bankruptcy, sub-prime auto loans, cheap auto loans and many more, which are further bifurcated in secured and unsecured ones. Lenders offers you the best possible option of car loans, whether you need to purchase a new car or an old one. Banks like ICICI, Bank of Baroda, State Bank of India, HDFC etc. are some institutions offers fixed as well as floating interest rate for a tenure, ranging from three to five years.

In India, millions have been fulfilled the availability of various car loans scheme offered by the numerous financial lenders and banking organization, which even enables consumers to own the latest model of cars of various manufacturer like Hyundai, Maruti, Tata, Fiat, Ford etc. the eligibility criteria to avail the car loan, seeks an individual to be between the age of 21 to 65 years as well as the person should be salaried person, professional, or self-employed. The car loans can be availed, when the individual’s net annual income must be more than INR 1,00,000. Whereas, it could get sanctioned when it will be of about 2.5 times the net income of the person.

http://www.bestsyndication.com/?q=20090821_nri_home_loans.htm

NRIs Focusing on Indian Investment

A stint or two abroad is a common thing for most professionals these days. No wonder, financial advisors have to deal with many Indians with non-resident tag these days. According to them, most non-residents are keen to keep their Indian ties intact and invest in various avenues like mutual funds (MFs), fixed deposits, real estate and so on. “Most of these people look to return to India finally. That is one of the reasons why they are keen to invest here,’’ says Suresh Sadagopan, chief Financial planner, Ladder7 Financial advisories.

Besides emotional reasons it also makes perfect sense as India is one of world’s fastest growing economies and they can hope to pocket superior returns here. “The chances of getting double digit returns abroad is limited. In India, you can always hope to get 8-10% returns,’’ says a wealth manager with a bank. “For example, Indian stock market has given even 100% returns till a few years ago, something one can never dream of in a developed country. Even fixed income investments will offer you around 8-10%, whereas getting even 3-4% from such instruments is considered great abroad,’’ he said.

But what are the investment avenues the NRI lot flocks to? Many a financial consultant maintains that property is a big attraction for them. “Most of the queries I get are related to property,’’ says an investment consultant who doesn’t want to be named. “Some people want to buy a home because they want to return to India eventually. Others look at property as pure investment. In fact, NRIs were a major force behind the real estate boom that went bust recently,’’ he adds. Sadagopan says some NRIs are also keen on MFs as they are permitted to invest in the entire universe of schemes. “It is not true that everyone wants to invest only in property. Some are also keen to invest in mutual fund schemes, as they know there is a possibility of superior returns,’’ he says. “Also, there are no restrictions on where they can invest. OIC and PIO enjoy all privileges like ordinary Indians. They can invest anywhere they like,’’ he adds.

However, financial advisors caution NRIs that they have to be careful while listing the details at the time of investment. They should clearly mention their status, complete with relevant documents and details. Suresh Sadagopan offers an example of investing in MFs: “They should clearly mention in the application form that they are NRIs. They should also provide their overseas address.’’ He also adds that in the case of fixed deposits, they should know the difference between various deposits like NRE account and NRO account. This is crucial because you can repatriate the income under NRO, while you can’t do the same in NRE account. The issue of relevant papers and documents is something that creeps up regularly in conversations with financial experts. They all insist that having relevant documents is a key factor. “Some investments may require the investor’s status card abroad. If they are going for insurance cover, the company may ask for details like work permit in some cases. It can vary from company to company,’’ says Sadagopan.

Source : http://www.indianrealtynews.com/real-estate-india/nris-focusing-on-indian-investment.html

NRI meet to seek changes in Indian property laws

NEW YORK: The Global Organization of People of Indian Origin (GOPIO) will pressure the Indian government to amend property laws to protect the  interests of NRIs at its annual conference here this week.

The biggest and oldest body of the Indian diaspora will hold its two-day conference at the Crown Plaza Hotel near LaGuardia airport Aug 21-22.

It will be opened by Oversees Indian Affairs Minister Vayalar Ravi. The 20th annual conference will also be attended by Frank Wisner, former US ambassador to India.

“Though our main theme is ‘People of Indian Origin: Strengthening Global Connections’, our thrust this year is to put fresh pressure on the Indian government to change property ownership laws for NRIs,” outgoing GOPIO president Inder Singh said.

“How can we wholeheartedly involve ourselves in India’s development if someone steals our investments and properties in our absence? The current Indian laws are so outmoded that they are not even fit for Indians, let alone the diaspora,” Singh said.

“We are 25 million in strength and pumping billions into India. And don’t forget that it was the NRIs who ushered in the IT revolution in India to set it on the path to greatness.

“India should realise that we matter a lot in its aspirations to become a superpower,” he said.

Apart from Vayalar Ravi and Frank Wisner, the conference will also be attended by Basdeo Pandey, former prime minister of Trinidad and Tobago, Logie Naidoo, mayor of Durban in South Africa, and Lord Daljit Rana from Britain.

GOPIO counts the institution of the Pravasi Bharatiya Divas and People of Indian Origin (PIO) and Overseas Citizenship of Indian (OCI) cards as its biggest achievements in its two-decade history.

“We mooted these proposals to the Indian government at our very first conference in 1989. Finally, when the Vajpayee government set up the L.M. Singhvi panel to discuss the issue, we worked with it. We also proposed that prominent Indians abroad be recognized each year for their services to India,” said Singh.

He said GOPIO also worked with other Indian bodies in the US to put pressure on Congressmen and Senators to vote in favour of the nuclear deal bill last year.

Singh said their future agenda is to turn GOPIO into “the Rotary Club of the Indian diaspora at the local level in their adopted countries”.

Source : http://timesofindia.indiatimes.com/news/world/indians-abroad/NRI-meet-to-seek-changes-in-Indian-property-laws/articleshow/4905037.cms

NRIs Showing Interest in Real Estate India

“The right sized product, at the right price will surely be a sell-out,” says Sukhraj Nahar, chairman of the Nahar Group. At the MCHI’s India Realty Expo, 2009, in Dubai, the Nahar Group offered NRIs homes in a new segment – a two BHK flat that cost INR 55 lakh onwards, which received good response. “The NRI customer needs the security of being able to walk up to the chairman of the company and ask just about any question related to the project,” says Nahar, on the product’s success. MCHI CEO, Zubin Mehta, substantiates the return of NRIs’ interest in Indian realty with figures from the exhibition: a turnout of 1,096 NRI families; 106 flats worth Rs 65.33 crore ($13 million) booked and around 86 flats worth Rs 80.18 crore ($16 million) in the pipeline; site visits fixed for July-August, when the NRIs come to India on their annual vacation.

“We tweaked the format and offered products that were nearing completion, with a budget limit of INR 75 lakh, mostly in the suburban areas and these were perceived by the NRIs as having scope for further value appreciation,” he says. “The softening of real estate prices and home loan interest rates in India, were the key factors for attracting a large number of NRIs,” says Mehta. HDFC’s branch manager (Dubai), Vikram Goel, reveals that innovative schemes, like the ‘20:80′ home finance scheme offered by HDFC and the Nahar Group, play a big part when it comes to garnering bookings. “The average NRI is worried about the economic challenges, across the next year or so. Hence, they find schemes like these, which provide for 20 per cent payment at the time of booking and the remaining 80 per cent at possession, attractive,” he added.

“NRIs are facing a unique situation,” says JS Augustine of Everest Developers. “There is a certain amount of job uncertainty, due to the global economic situation. At the same time, Indian real estate offers lower entry-level prices, with potential for good returns on investment (ROI). So, NRIs who are sure of their job for the next few years, are buying Indian real estate. The INR/USD rate differential also makes it more attractive for NRIs to buy now,” he says, adding that it is necessary for Indian developers to meet NRIs more often, to create confidence and give them more comfort. What works for the NRI buyer? It has to be innovation and a different product, from what has been on offer so far and at a price level that seems attractive to the NRI buyer who has the global property market to choose from, concludes Rajnish Oswal, MD of Dubai-based real estate firm, Home Back Home.

Source : http://www.indianrealtynews.com/real-estate-india/nris-showing-interest-in-real-estate-india.html

NRIs buying properties in India, Indians going abroad

New Dehi: After long lull, there is flurry of activities in the realty sector. The large NRI community, especially Malyali and Punjabi, are on rampage. If the recent study of Assocham on the real estate scene in India is any indication, the large Malayali and Punjabi NRIs are buying the houses of their liking. It is a well-known fact that Malyalis and Punjabis have migrated in hordes over the years. Some of them are also buying commercial space.

People from the land of five rivers have been migrating for almost one hundred years and the quiet Malyalis have also shown to the world that they are second to none when it comes to going abroad for greener pastures. Of course, that does not mean that NRIs from other states are not purchasing houses in either their home towns or other parts of the country.

Eminent scholar Dr. Chandrasekhar Tiwari of Delhi University, who has been studying Indian Diaspora from various angles, says that perhaps only those NRIs are buying properties in India who have migrated to other countries during the last 25 yeas or so. They are still very much close to their roots. ‘‘I am pretty sure that those who had shifted before 25 years or so are not buying properties.  Only the first generation NRIs are coming back to India,’’ feels Dr. Tiwari.

Meanwhile, it is learnt that Malyali NRIs prefer to buy some kind of property in their capital city Thiruvanathapuram, Trichur, Kottayam and other such big towns. Of course, there are many who have purchased houses in metros cities too. And if you talk about the macho Punabi NRIs, they do not mind buying houses even in Delhi, various NCR towns and also developed cities of their own state. Unlike Malyali NRIs, they buy commercial properties too.

DR. Devender Gupta,CMD of realty advisory Century 21 India, says that that more often than not NRIs buy flats in the range of Rs  60 lakhs to Rs 80 lakhs. They buy properties for purely investment purpose.  There is hardly any emotional factor that is involved in. As and when they get good appreciation on their properties, they dispose it off.

Meanwhile, with real estate prices at an all-time low across borders, buying property abroad is suddenly making sense to affluent Indians. “The property slump is not just confined to India. Prices have crashed considerably in the US, the UK and the Middle East and many Indians are seeing this as an opportunity to buy property there,” Rajesh Goenka, chairman of Axiom Estates, the London-headquartered provider of property services in India.

So much so, high net worth Indian investors are spoilt for choice: sea-facing villas in picturesque Mauritius, studio apartments and country cottages in Britain, condominiums in Singapore, and super-luxury homes in the Gulf. But of all foreign locales, Dubai is the most sought after, say brokers familiar with the latest fad.

“Dubai is the hottest destination for celebrities and the rich on the hunt for a dream home. However, real estate prices were so steep allthese years that very few could afford property there. Now as the slowdown has hit the Dubai realty market also, rates are down by 30-50 percent,” Goenka said.

“Buying property in Dubai attracts no government tax and even if you put your property on rent, the income is completely tax-free,” said Syed Mazaz, the Mumbai representative of Dubai-based real estate brokerage, Better Homes.

According to him, property prices in Dubai are comparable to those in Delhi or Mumbai – starting from as low as Rs.3 million ($62,000) for a studio apartment in the International City project in Dubai to Rs.15 million ($309,000) for a two-bedroom luxury apartment facing the sea.

“Tell me, can you get a similar bargain in Delhi or Mumbai? I”m getting many enquiries and about one-third of them end up buying a home in Dubai,” Mazaj said In Europe, Britain is the favourite destination for Indians planning property investment.

“The UK has a huge NRI population and attracts a large number of Indian professionals. No wonder people are buying property there. We alone are receiving at least 100 queries for the UK every week, leave aside other consultants,” Goenka said. “However, in most European countries and the US, the preference is for studio apartments and two-bedroom sets,” he added.

One such interested buyer is Noida-based businessman Subham Agarwal. “Both my children are studying in the UK and I feel that they may ultimately settle down there. So taking a house there is not a bad option when property prices are at an all-time low,” Agarwal told JITO. Adding: “I am planning to buy a studio apartment for my children.”

Countries such as Singapore, Mauritius, Thailand and Malayasia – where prices have dropped up to 30-40 percent in recent months – are also attracting Indian investors. In Thailand, a two-bedroom apartment costs around Rs.2.4 million ($49,000), and can go up to Rs.40 million ($824,000) for luxury apartments. In Singapore, this would be in the range of Rs.2.6 million-Rs.26 million ($54,000-536,000) for similar accommodation, while it will be between Rs.3 million ($62,000) and Rs.12 million ($247,000) for two-three bedroom apartments in Malaysia.

In Mauritius, super luxury villas are going for Rs.20-30 million ($412,000-618,000). Apparently, for India’s affluent circles, these are ’steal deals’ – getting a second property abroad at domestic rates. Explains Jaideep Singh, head of the India desk at global property consultant Knight Frank: “People are buying property abroad because these are as expensive or sometimes even cheaper than in India, which makes it perfect for getting a second, or a third home.”

Source : http://www.mynews.in/fullstory.aspx?storyid=21248

19 Indian realty firms showcasing projects in London

London, June 28: Nineteen Indian realty developers are showcasing their housing projects to NRIs here at a two-day ‘India Homes Fair’, which began on Sunday.

The realty firms participating in the event include Ansal Properties and DLF Home Developers. The 19 developers showcasing their projects are from the Indian cities like Bangalore, Chandigarh, Chennai, Hyderabad, Jaipur, Mumbai and New Delhi.

“Almost all major developers from India are participating in the fair attracting good response from the NRI investors,” Renu Sud Karnad, joint Managing Director of India’s leading housing finance firm HDFC, the organiser of the event, said.

The price range of properties being showcased at the fair vary from Rs 21 lakh to a couple of crores, Karnad said.

“Through this event, we are bringing NRI home-seekers and leading developers from major cities across India together under one roof.

“We hope to provide a platform where both of them can interact freely so that the developers are exposed to the NRIs, their needs and preference,” she said.

M Subhashini, Minister, Press and Information in the High Commission of India to the UK, inaugurated the fair.

Source : http://www.zeenews.com/news542821.html

Political Stability Can Bring Back NRI Interest in Indian Property Market

India’s thumping electoral victory will mark the return of confidence and also funds to the Indian real estate sector, says Sukhraj Nahar, chairman of Nahar Group, “Having a stable government at the centre should provide a bottom to the Indian real estate market and help turn it around. Improved economic sentiment and rallying stock markets should bring back confidence,” explains Nahar “The positives have been visible in the recent past. At the MCHI Property 2009 Exhibition in Mumbai last month, we had done a ‘teaser’ for this new product, last fortnight we launched it – and have logged 300-plus sales. Now, with political stability clear for the next five years, we expect sales to grow faster,” he says.

Nahar’s statement reflects the sentiments of developers across the Mumbai Metropolitan Region, where the past few months have seen a good number of bookings. According to Nahar, the biggest motivating factor for NRIs to buy property at the Indian Real Estate Expo that is on till June 6 in Dubai, will be the political stability that follows the second term of Prime Minister Manmohan Singh. “We have been getting enquiries from NRIs ever since the poll results were announced,” he explains. “The moment it was clear that political stability was ensured, NRIs reacted and started the process of buying a home in India. In the local market too, we find ‘fence sitters’ have turned active buyers, it augurs well for real estate,” says Nahar.

Source : http://feedproxy.google.com/~r/Indian-Realty-News/~3/98hs698viBI/political-stability-can-bring-back-nri-interest-in-indian-property-market.html

NRIs Seen Investing in Indian Real Estate

DUBAI — India’s thumping electoral victory will mark the return of confidence and also funds to the Indian real estate sector, says Sukhraj Nahar, chairman of Nahar Group,

“Having a stable government at the centre should provide a bottom to the Indian real estate market and help turn it around. Improved economic sentiment and rallying stock markets should bring back confidence,” 
explains Nahar.

“The positives have been visible in the recent past. At the MCHI Property 2009 Exhibition in Mumbai last month, we had done a ‘teaser’ for this new product, last fortnight we launched it – and have logged 300-plus sales. Now, with political stability clear for the next five years, we expect sales to grow 
faster,” he says.

Nahar’s statement reflects the sentiments of developers across the Mumbai Metropolitan Region, where the past few months have seen a good number of bookings. According  to  Nahar,  the  biggest motivating factor for NRIs to buy property at the Indian Real Estate Expo that is on till June 6 in Dubai,  will be  the political stability that follows the second term of 
Prime Minister Manmohan Singh.

“We have been getting enquiries from NRIs ever since the poll results were announced,” he explains.

“The moment it was clear that political stability was ensured, NRIs reacted and started the process of buying a home in India. In the local market too, we find ‘fence sitters’ have turned active buyers, it augurs well for real estate,” says Nahar.

Soource : http://www.khaleejtimes.com/biz/inside.asp?xfile=/data/business/2009/June/business_June223.xml&section=business

NRI Community Comes in Support of the Realty Sector

Notwithstanding the impact of slowdown on realty sector and even after demand for flats up to Rs 30 lakh and 40 lakh and above really hit a new low, thre are still ready buyers for independent houses. These hardy customers don’t take much time to grab an independent house in any good locality and location. These deep-pocketed guys always look for such properties.

According to realty experts, though not many such properties come up for sale, but once they do come up, there are several buyers staking claim over them. And if the house is free from all kinds of disputes and the title is also clear, a seller need not worry he has to wait very long to meet a customer for his house, says Titu Sethi, a South Delhi-based realtor , who has played a key role in sealing many deals involving bungalows and kothies.

Who buy independent houses after paying such huge sums? And another relevant question — whether the new buyer uses the property for his own use? Apparently, the profile of such buyers is mixed.

They may be NRIs, builders, or it is also possible that two or more brothers buy one house in order to live together with their families. While the concept of joint families is disintegrating and disappearing faster from the urban landscape, this fact lends hope that all is not lost for the concept of joint families and there are still many brothers who prefer to live under one roof.

Realtor Pramod Chopra of East Delhi says that he has seen, at least in some cases, where brothers buy one house and then start living on separate floors of the house. Businessman Rajat Dhawan and his elder brother did the same thing. Says Dhawan, “When we sold our family house at Nizamuddin West, we were asked by many friends and relatives if we were separating. We said, no! After selling our house, we purchased a 500 sq feet plot in DLF. Both my brother and myself built a house there and started living with our families.”

Coming back to the brood of happy buyers of big bungalows and kothies, realtors say that small-time builders also don’t miss an opportunity to buy houses in posh areas. Eventually , they convert such properties into flats and floors and then sell them off.

It has been happening in Delhi for many years now. Even in bad times, so far as realty sector is concerned, the large NRI community is also buying independent houses in Delhi and in NCR towns.

A Noida-based realtor says that after attack on Indians in both Kenya and Uganda, some Indian families purchased big kothies in Noida . It may be recalled that the family of a wellknown known Sikh businessman of Uganda, Gurdayal Singh Dhillon, too purchased a big house in Noida and a part of his family settled down there. Dhillon also remained the High Commissioner of his country in the country of his forefathers as recently as a few years ago.

But not all NRIs are buying houses because they are being persecuted in their adopted countries. Thailand-based NRI Surinder S Chawla says the reason his family purchased an independent house in Delhi, in New Rajinder Nagar , was that he and his other family members visit India very often in relation to their business interests as well as for meeting relatives here. And they thought it a better idea to have a house here than spending a bomb on hotels.

As far as NRIs are concerned, they too are buying flats and floors in Delhi and the NCR, even though builders are feeling the pinch in selling their flats. Sunil Jindal, CEO of SVP groups, says that NRIs from the UK, the US, and Canada have played a stellar role in lifting the spirits of realty sector. They are buying up flats, plots, floors and independent houses.

A random survey of New Rajinder Nagar, Jor Bagh, Multan Nagar, Greater Kaliash-II and Har Gobind Enclave reveals that around 12 independent houses were sold in these areas during the last six months. They costed between Rs 4 crore and a mind-boggling Rs 40 crore.

Experts say that for those who have ready cash, this is an ideal time to strike gold. Currently , the property prices are hovering quite low – reason enough for some smart people to grab any possible opportunity in purchasing the a property free from all kind of disputes.

Source : http://www.indianrealtynews.com/real-estate-india/nri-community-raises-the-spirits-of-realty-sector.html

NRIs Investing in Residential Projects

Last year, after RBI spelt out clear norms for NRIs to invest in property, and with NRIs holding Indian passport no longer requiring prior permission before investing, there was a spurt in NRI investment in Indian realty. According to Omaxe’s Rohtas Goel, “The policies set out by the government regarding property investment and repatriation, has made investments in India more favourable. NRIs can acquire residential/ immovable property in India, rent it out, transfer or sell it, if required. However, the regulations do not permit the NRIs and PIOs to acquire property like agricultural land, plantations and farmhouses. Moreover, GOI is allowing 100% repatriation, so NRI’s can now also take out the rental income and capital investment in the property outside India, subject to the foreign exchange regulations.” One noticed that NRIs, including young professionals, technology workers and domain-specific consultants invested in property back home, both in the semi-premium and premium categories.

One, they wanted to have a house of their own in their home country if they decided to return and the house covered both investment as well security factors, and two, this could be used as their holiday home, which stayed fully furnished and was used for a few weeks annually. However, with the market downturn, the scenario changed completely. Even though there has been increasing remittance, to the tune of $30 billion now, and it topped list of countries in the world in 2007 (according to World Bank study) where expatriates remitted money to their home country, real estate has received a small pie of the total investment. According to NRI Prashant Tandon, who is wary of parking his funds in real estate, “Indian real estate was overvalued all along, and now it is closer to realistic levels. I do not think I want to put money on a riskyasset class. I would much rather put it in some safer instruments, eg fixed deposits, bonds or blue-chip companies.” However, developers say NRIs are investing more in residential projects, compared to retail or office real estate, after the recent home loan interest rate cuts and price cut by developers.

Source  : http://www.indianrealtynews.com/nri/nris-investing-in-residential-projects.html

Making Property Investment Simpler for Non-Residents

As property markets fall world-wide, one of the few consolations for real-estate investors is that some governments have become more open to nonresident property owners. A growing number of them are considering loosening or temporarily suspending foreign property-ownership restrictions in a bid to stimulate their real-estate markets. In January, for example, Beijing issued a one-year suspension of a one-year residency requirement for foreign nationals buying a house. The Cayman Islands and Australia have also recently loosened their rules. Meanwhile, the issue is being discussed in numerous other countries, including the Philippines. Loosening foreign-investment restrictions isn’t new. Governments have been attempting to stimulate foreign investment for years in response to swelling interest from international investors. In 2005, India began letting foreigners invest directly in Indian residential and commercial real-estate development. And in late 2006, the government lifted a required 10-year lock-in period on repatriating property sale proceeds, although it’s limited to $1 million a year.

Slumping property sales has given the issue renewed urgency, as countries strive to find ways to stimulate local economies. Last month, the historically foreign-investment-friendly government of the Cayman Islands temporarily lowered rates on their real-estate transfer “stamp duty” taxes, including a reduction to 5% from 7.5% on waterfront property. At the same time, the country’s real-estate brokers group, Cayman Islands Real Estate Brokers Association, announced a 20% rebate on commissions. The discounts last through Sept. 30. Restrictions on foreign ownership exist mainly in emerging property markets. Most Western European countries, including the U.K., France and Italy, don’t restrict foreign nationals from owning real estate. (Notable exceptions are Switzerland and Austria, which have established some foreign-buyer quotas to keep prices down in some ski towns.) The U.S. doesn’t restrict foreigners from buying property.

Ways to restrict foreign investment aside from outright bans include high transfer taxes and limits on when and how much money investors can repatriate. Rules can differ depending whether the purchase is a residence or an investment. To be sure, not all countries are choosing to loosen regulations. Some may crack down on foreign investment, blaming it for driving prices to unsustainable levels, says Danny Bance, managing partner of U.K.-based International Property Investment Network, a research and investment services provider for investors. But many governments believe that foreign investment spurs infrastructure development, which spurs economic opportunity, says Mr. Johnson, 59 years old, of Detroit, who got his start developing luxury property in Michigan, including a large Lake Michigan resort. He says he helped convince the British Virgin Islands government to loosen curbs on foreign investment partly through his willingness to hire local residents for senior management positions.

Source : http://www.indianrealtynews.com/nri/making-property-investment-simpler-for-non-residents.html

Roadshow by Realtors to woo NRI Bengali’s

City realtors are set to woo the non-resident Bengali community in recession-hit North America with their first “comprehensive” real estate roadshow in that part of the world.

Credai Bengal, the state chapter of the national umbrella body of real estate developers, will hold the realty expo during the North American Bengali Conference (NABC), scheduled for July 2-4 in San Jose.

“We have been going to the NABC every year in bits and pieces, and we felt that doesn’t do justice to the real potential of the city as an investment destination and the wide array of real estate products now available here. Hence the decision to stage a full-fledged show,” says Pradeep Sureka, the president of Credai Bengal.

With fears of job loss and pay cuts casting a pall of gloom over the US economy, many NRIs are seriously contemplating returning to their roots sooner than they had envisaged and this has fuelled demand for flats back home, feels the realtors’ body.

“The NABC is a great opportunity to reach out to the large number of Bengalis settled in the US. More so, since the location is the Silicon Valley this time, a traditional bastion of Bengali IT professionals,” says Santosh Rungta, a senior city developer who has taken over as the president of Credai’s national committee.

Around 10 developers have confirmed participation with a basket of a dozen-odd products, and the Credai Bengal brass is hopeful many more will join the Silicon Valley roadshow, once the marketing for the July event gathers momentum.

“Besides the residential segment, we are also anticipating a large participation from IT infrastructure providers, simply because the show is in Silicon Valley,” adds Sureka. Efforts are on to convince Writers’ Buildings to use this opportunity to underline some of the “core strengths” of the state to the NRI Bengalis in the US.

“Around 4,000 visitors enquired about Indian properties on show at the Dubai realty expo last year. Here, we can reach out to 10,000 NRI Bengalis focused on buying properties in Calcutta,” says Pradip Chopra of the PS Group, the past secretary of Credai Bengal.

Source : http://www.indianrealtynews.com/real-estate-india/roadshow-by-realtors-to-woo-nri-bengali%e2%80%99s.html

Depleting NRI Interest Force Developers to Put Projects on Hold

Real estate majors, who had lined up projects in Punjab to woo non-resident Indians, have put on hold their plans indefinitely with most NRIs no longer keen to invest in these properties. These players had planned integrated townships and shopping complexes in towns including Mohali, Jallandhar, Bhatinda, Patiala and Amritsar for the NRI customers. But with dwindling incomes across the globe, NRIs too have tightened their purse strings. Among those who have put their plans on hold include DLF, Emmar MGF, Zoom Developers Private Limited and Omaxe Limited.

Zoom Developers president and chief executive officer Rumneek Bawa said the company was going slow on its investments in Punjab. The company, which announced an investment of Rs 600 cr across Amritsar, Patiala, Jallandhar and Bhatinda for constructing housing complexes, hotels and shopping malls in 2007, has till now invested only 30 crore. “A housing complex with 100 expandable villas on 225 yards each at Patiala was in the pipeline. The villas, which were proposed to be ready in 18 months, may now take longer as the buyers are not as aggressive as were expected to be,” he said.

Similarly, Emmar MGF was to invest Rs 16,000 crore in housing and infrastructure projects in Punjab. It proposed an integrated township project in Mohali on 3,000 acre and also announced that it would launch other integrated township projects in Jalandhar and Ludhiana. Each project was be spread over 400 acre. DLF Limited, on the other hand, had planned to set up two integrated townships each in Mohali and Chandigarh besides commercial projects. A company official said they were going slow on projects where they had not made any commitments. He added that the shopping mall in Jallandhar will be operational on schedule.

Source : http://www.indianrealtynews.com/nri/depleting-nri-interest-force-developers-to-put-projects-on-hold.html

For developers, customer is king once again

The persistent fall in property prices across the country, aided by RBI measures to slash key rates and spur demand, seems to be reviving interest among home buyers.

“Site visits have gone up almost 10 per cent in past 2-3 months. This can be attributed to the price cuts and to RBI announcements, which have made home loans cheaper,” says Harsh Nair, real estate consultant based in Chennai.

Customers have become far more discerning following the global economic meltdown and do not betray the recklessness that characterised the period of realty boom.

During the real estate boom, buyers, flush with funds, were willing to pay any amount. Developers were offering housing opportunity using themes, promos and freebies. Now, the emphasis is on “value for money” projects.
“We are emphasising on our USP, which we believe is quality control. We are showing prospective customers how we do not compromise on quality in terms of all the aspects of our units, whether its fittings or architectural design or raw material,” says Keshav Pandey, executive director, Sobha Developers.
Developers had gone out to woo young professionals, and double-income couples who earned handsome salaries. However, with the recession in the US and Europe, order books have thinned. As such salary increments in the IT sector have been rather poor and software companies are even resorting to layoffs to cut costs and stay afloat.
“Now, there is no specific age bracket for the prospective buyer. Buyers are looking for good home loan rates and a good home that they can buy within their allotted loan limit,” a senior banking official
told FC Estate on conditions of anonymity.

Given the price corrections in the realty market, NRI buyers are looking at taking advantage of the situation by buying multiple housing units in India. The sharp decline of rupee against the dollar has also made the sector that much more attractive.
Industry watchers advise that prospective buyers should have a multi-point checklist before they purchase a property.

According to Shreyans Chopra, CEO, Suksh Technologies, the parent company of realty portal www.100floors.com,“If you want to buy a house, location should be a key consideration. Identify pockets that have a potential to appreciate quickly, and a profitable situation will be to even out your rentals with EMIs. As a thumb rule, if rentals account for 10-12 per cent annually on actual value of home, it is better to consider buying one.

Even if property rates do not appreciate, it is a profitable deal; you have an asset to bank on even as you pay EMIs that equal the money you pay as rent. Considering a long investment horizon (10 years), this is always a good option.”

Good localities have planned infrastructure development around them such as metros, shopping malls, offices and airport.
A home on or near the main connecting roads rather than in the interiors will bring in more returns in the long run. A well-decorated, well-furnished house, but in the interiors, would fetch lower valuations when you want to resell the property.

http://www.mydigitalfc.com/real-estate/for-developers-customer-king-once-again-577

NRIs- Ray of Hope for Realtors

Realtors in Mohali district have seen a ray of hope among NRIs to keep their business going during the global slowdown. While the local buyers are hesitating from buying houses coming up in large number in the district, it is the interest of NRIs from Canada, US, England and middle-east countries that has given a new lease of life to real estate sector. With thousands of NRIs inquiring about the availability of houses, flats and villas, real estate sector has all of a sudden got fresh lease of life that otherwise was witnessing a low business for the last four-five months. A visit to Zirakpur and surrounding areas revealed that number of inquiries from NRIs for housing properties in Mohali have gone beyond 3,000 during last few months.

Such is the response that one of the real estate development Royal Estate has already decided to come up with a NRI tower in Zirakpur due to rising demand for houses from NRIs. Krishan Goyal, managing director, Royal Estate Zirakpur, said during last two months he had received over 500 inquiries from NRIs and had already sold 4-5 flats to them. ??We have now decided to come up with NRI tower at Royal Estate as demand is great,?? he added. Satish Jindal, managing director, Maya Garden Zirakpur, too is smiling with the expectation of good business ahead as after receiving over 600 inquiries for houses during last two months, he has sold 6-7 flats to them. Response from NRIs is amazing and it shows that good days for real estate sector are lying ahead, he added.

Many of the builders attribute the sudden interest among NRIs for houses in Zirakpur and surrounding areas to the fact that from June onwards international flights are scheduled to take off from upcoming international airport. Interestingly, while Indians residing abroad are showing great interest in buying property in Mohali district, domestic buyers are not coming forward to buy while inquiries in hundreds are being received. Realtors are expecting market to improve on local front also. Subash Chand, partner, Swastic Vihar Zirakpur, said that while there was good response from the NRIs, local buyers are waiting for the property prices to be slashed further. They expect good business from April 1 onwards, as service tax would be completely withdrawn and interest rates are expected to be lowered further. Vijay Arora, president, Peermuchalla Builders Association, said that around 100 inquiries are coming on a single day while sales are not picking up. All expectations are resting on new financial year. With NRIs buying property it seems that market would improve further he added.

Source : http://www.indianrealtynews.com/nri/nris-ray-of-hope-for-realtors.html

Govt Liberalises Investment Norms for NRIS in Real Estate

The government has liberalised investment norms for NRIs to invest in real estate in India. At the same time there is a need of adhering to ground realities before plunging into investment. We provide some of the frequently answered questions answered recently by the Reserve Bank of India.

Who can purchase immovable property in India?

Under the general permission available, the following categories can freely purchase immovable property in India:

i) Non-Resident Indian (NRI)- that is a citizen of India residing outside India ii) Person of Indian Origin (PIO)- that is an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan), who 1. at any time, held an Indian passport, or 2. either whose father or grandfather was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955).

The general permission, however, covers only purchase of residential and commercial property and not purchase of agricultural land / plantation property / farm

Source: http://www.indianrealtynews.com

NRI’s Invest in Real Estate Despite Recession

Non-Resident Indians (NRIs) and overseas Indians feel that with the property rates heading southwards, time is ripe to invest in India’s real estate industry. Experts are of the view that the Indian economy is probably one of the few investment destinations across the globe as it would be one of the very few countries that will be growing at five to six per cent despite the global meltdown. India’s real estate companies faced slowing sales as homebuyers waited on the sidelines for prices to fall further and companies put expansion plans on hold as interest rates remained high and banks went tough on lending. But with funds flowing in from abroad, the situation might not seem all that grim. “I used to invest in stocks, but now I feel real estate is a better alternative when it comes to long-term investment,” said Suraj Patel of Gujarat who lives in New Jersey for a major part of the year. The fluctuations at the stock market have made investors wary of speculating in share prices and are taking to the real estate sector. “I used to invest in the stock market daily, but then it is not lucrative. The share prices are going down and people are making huge losses. I think real estate is the right place to invest as the prices are comparatively low. Gujarat is a good investment destination,” said Snehal Patel, another NRI real estate investor. Economic growth of about nine per cent over the past few years had boosted demand for hotels, offices, homes and malls, as well as roads, ports and airports across India. But with the global recessionary trends seeping in, even this sector has not been left untouched. In fact, a boom that followed a 2005 move to ease rules on foreign investment in the construction industry is ending in a bust. But overseas Indians feel that real estate is a good investment alternative in times of global meltdown. Source : http://www.indianrealtynews.com/nri/nri%e2%80%99s-invest-in-real-estate-despite-recession.html

Banks Allure NRIS into Real Estate with New Schemes

The booming real estate market in the country has prompted industry players to introduce a slew of innovative products to people willing to pay. From real estate developers to real estate fund managers, from banks to housing finance companies, it’s a party time for all. But behind those euphoric times, some banks, with operations in India and outside, are offering innovative products to non-resident Indians (NRIs), which could turn tricky in case Indian real estate market falls into a trough, sources said.

It involves the foreign and Indian operations of the same bank, the NRI and his friends, relatives and associates based in India. To start with, NRI, with the help of his friends and others, establishes an Indian company that could do business in the real estate sector. Now the bank in India gives some loan to the company to buy land in India.

On the other hand, the NRI keeps a fixed deposit with the wealth management division or private banking arm of the same bank’s overseas operation. Unofficially, the foreign branch of the bank, with FD in its books, stands guarantee to the loan given by the bank’s Indian operation to the company set up by the associates of the NRI. But the same is not officially shown as a guarantee in the books of the two branches involved. As per current FDI rules in real estate, any residential project in which foreign money in invested, should be on a land measuring 25 acres or more. For commercial properties, the minimum stipulated area should be 50,000 square metres.

However, market players said with the realty boom, NRIs find it tough to get land at market rate. Whenever the seller gets to know foreign money is involved, they demand prices higher than the market rates. The rates go up further when sellers get to know that the buyer wants adjoining plots which should aggregate at least 25 acres.

In such a situation, the company established by the associates of NRI buys smaller plots of adjoining land without raising the rates much or even raising suspicion of the sellers that an aggregation is on play or even foreign money is involved. Once enough number of plots are bought, those are aggregated (to at least 25 acres) and the company then transfers the same to the NRI to comply with FDI rule. While the NRI pays back the bank in India, his FD kept in the bank overseas is also released at the same time.

Source : http://www.indianrealtynews.com/nri/banks-allure-nris-into-real-estate-with-new-schemes.html

Realty Market Ripe for NRIs

For the Gulf NRIs weighing his options diligently and with foresight, some attractive opportunities are on offer in the real estate sector. Consider these facts: Lenders are slashing home loan rates; Prices of real estate have slipped in tandem with the stock indices; Recession in the United States and Europe has forced many NRIs to rethink their property investment plans in India leaving thousands of plush homes in ‘NRI colonies’ without buyers. There has been a drop of 50-60 per cent bookings by the NRIs over the last three months owing to tight liquidity conditions in the international markets, top realty players told Sunday Economic Times. If 100 bookings were being made earlier, today that’s not more than 30. There have been atleast 15-20 percent cancellations over the last few months. Developers expect the situation to continue till the liquidity situation improves in foreign markets.

This one time at least, NRIs in the Gulf have an advantage over those in the West as the GCC economies have been much less affected by the meltdown. Apart from some layoffs, there has not been much adverse action such as slashing of earnings. Unlike those in the West, it is unavoidable for the Gulf NRIs to have a home of their own – not necessarily their ancestral home which they left behind, but a more modern and better-equipped place like the homes available in the many housing complexes developed exclusively for NRIs across the country.

NRIs, even those in the Gulf, get accustomed to certain amenities which they wouldn’t mind having back home as well. They need to have malls, multinational restaurants, high-end entertainment areas, good hospitals and schools and maybe even a golf course when they return to settle here permanently. And, that may be sooner than one had planned. At this point, with the US and UK biggies pulling out, such homes may be available at heavy discounts. Then, the second bit of good news. Home loan rates have begun their southward journey, following a fresh initiative from the Reserve Bank of India (RBI). HDFC (Housing Development Finance Coporation), India’s biggest home loan provider, has taken the lead and lowered the rate it charges for all loans and deposits by 50 basis points.

The Mumbai-based finance company will charge 10.25 percent for loans of up to Rs 2 m effective Dec. 22. The rate on loans of more than Rs 2 m was reduced to 11.25 percent. The lending rates have been cut as a result of a reduction in funding costs. State Bank of India and other banks have cut rates after the central bank lowered a key interest rate three times since October to 6.5 percent. Interest rates are headed down and the cost of borrowing bulk deposits has fallen by 200 basis points over the past two weeks.

India’s public sector banks said earlier this week that they plan to offer home loans of up to Rs500,000 at 8.5 percent. The rate will be limited to 9.25 percent for borrowers seeking loans of Rs500,000 to Rs2m for a five-year term. NRI home loans are loans available to Non-Resident Indians for the purposes buying houses that are under construction or for sale. They can also be availed to buy a plot of land or to renovate/improve an existing property. The home loan rate charged by an NRI does not differ much by the interest rate charged by an Indian for his home loan but the tenure for such loans differs to a great extend. NRI home loans are extended for much shorter period as compared to the normal home loan. The loans tenure for NRIs extends from 7years up to a maximum tenure of 15years where as the maximum tenure for a resident is from 25 to 30 years. Also an NRI cannot opt for a loan tenure that exceeds beyond his retirement age or 60years, which ever is earlier.

Besides an NRI can only get 85 per cent of the loan amount and the remaining 15 percent has to be brought himself by the borrower. The loan amount depends on the individual’s gross monthly earnings. This amount is normally up to 36 times of the gross monthly income but there is also a maximum limit on this amount.

The real estate market in India might be facing one of its worst slowdowns, but its position relative to markets in the rest of the Asia Pacific region remains promising. In terms of investment, Bangalore, Mumbai and New Delhi are all new entrants to the top 10 markets in the Asia Pacific at fourth, seventh and ninth place respectively by PricewaterhouseCoopers.

Yes, prices are low. So, it is wise to start planning a real estate investment now or wait for the market to bottom out. Quite obviously, the latter would seem logical. However, how can one tell where’s the bottom? “The problem is that everyone is trying to catch the bottom, and that is what needs to change,” says Anshuman Magazine, Managing Director of CB Richard Ellis in India, a global real estate consultant. Prices may or may not drop further. Unlike the United States or the United Kingdom, there is no 30 years old data that is available here for prediction purposes. Also, whatever data is available; it is difficult to verify its authenticity. Therefore, the consumer should not go by the expectation that prices will fall further, because there is no way to know for certain.

Source : http://www.indianrealtynews.com/nri/realty-market-ripe-for-nris.html

Omaxe, the Indian Real Estate Developer Giant Targets NRI Buyers

The recent depreciation of the rupees against the dollar has been diverted Indian real estate property developers towards the NRIs living in various places of globe. This may also be the ideal time to invest in property in India because the recent slowdown may become 20 percent benefit for the NRIs.

Delhi, India, November 29, 2008 –(PR.com)– With the rupee depreciation with the dollar, Omaxe and other property developers in India plan to target the NRI buyers. NRIs can get a good deal now because of the recent depreciation of the rupees against the dollar. This would benefit NRI purchase around 20 percent. Property investment in India at this time could be a good deal. Prices have declined by 15 to 20 percent in last few weeks.

The Omaxe Real Estate Developer, one of the leading companies in this field is offering NRI property investment like multiplex, shopping complex to 2BHK apartments in Bangalore, Pune, Calcutta, Chennai, Hyderabad and already sky high Mumbai and Delhi. It is one of the top real estate developers which has a lot of experience and is committed to achieving excellence. They also have a separate interface for Non resident Indians (NRIs). Other features the company offers are: email-based subscription for newly launched projects. This keeps the readers up-to-date with the latest news regarding the real estate infrastructure and current sales in their specified city based on their budget-based selection and choice of accommodation/housing.

Omaxe India Ltd claims to be the first ISO 9001 certified company in northern India, which develops real estate in Northern, Central and Southern India. As their line says, ‘Turning dreams to reality’, the company does the same with their state of art designs which are similar to the international standards. The company hosts experts in the field who give their best to all their projects. Over a period of time Omaxe have executed a number of high profile projects for multinational clients. NRIs have played a very important role in transforming the Indian real estate market. Opening-up of the Indian economy provided them with new opportunities and they have shown a great deal of confidence in the changed set up.

This is the time when people recognize the importance of selecting the right place to invest. According to Mr. Girish Garg, Head of Marketing, “our site has always been at the forefront for the way our projects have been dealt with. Each one of them has a unique feature about it, which best describes its utility. We use the best materials in construction, which ensures safety and longevity to the buildings. And a lot of research and planning goes into each of our projects, so as to guarantee client satisfaction.

Most of our clients have given us repeat projects, impressed by our work”. With their numerous projects running simultaneously they have proved that they have carved a niche for themselves in the real estate sector. For more information on their ongoing and forthcoming projects one can log on to www.omaxe.com

Source : http://www.pr.com/press-release/119228

Developers Feel Falling Rupee will Woo NRIs

City’s real estate developers are hoping that the falling rupee would help woo NRI customers and prop up the market here. Stung especially by dropping of sales by about 80% in Mumbai, real estate developers are now going to the UAE in a bid to hardsell to Non Resident Indians (NRIs). The Maharashtra Chamber of Housing Industry (MCHI) is holding its property fair from November 27 to 29. While the MCHI has been organising the property fair in Dubai since 2002, this year holds special significance. The rupee has depreciated from the Rs40-mark a few months ago to the Rs50-mark against the dollar last week, a fall of over 20% in a span of a few months. So, a 2-BHK flat which earlier cost Rs1.25 crore, an NRI will now have to shell out only Rs1 crore.

And if developers offer the NRI discounts such as stamp duty and free parking that they gave at the MCHI Property Fair that concluded two months ago at Bandra Kurla Complex, then buyers could be get benefit of about 40% and the flat could be available for as low as Rs95 lakh. “Prices too have begin to decline. NRIs can get a good deal now and we intend to highlight this,’’ said Zubin Mehta, CEO of MCHI, adding that the rupee depreciation against the US dollar would be a major selling point to NRI buyers. Mehta said the main reason for targeting UAE NRIs was that they were mainly working-class people who have gone to Dubai and other places in the UAE with the aim of earning a living and buying a home in India. “They are not permanent residents like in the United States or the United Kingdom. They primarily earn their living in the UAE and buy a home in India,’’ Mehta said.

Source : www.indianrealtynews.com

NRI Home Loan: A friend for the non-residents

Are you residing abroad and thinking of investing in a residential property in India then NRI home loans are the best option for you. Usually NRIs are doubtful whether they can invest in a residential property in India or not. They are not aware if they can dispatch funds from abroad under the current foreign exchange regulations to make any such purchase in India.

NRI can easily buy any immovable property in India through a number of options. But again the question arises that if an NRI want to invest here and he does not have sufficient funds then what should he do? Under such circumstances an NRI has a ready-made option of NRI home loans in India.

NRI home loans are loans available to Non-Resident Indians for the purposes buying houses that are under construction or for sale. They can also be availed to buy a plot of land or to renovate/improve an existing property. For extending such a loan all banks and housing finance companies go by the definition of NRI as given by RBI – “An Indian citizen who holds a valid Indian passport and who stays abroad for employment or for carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a NRI.”

NRI home loans can be availed by any NRI with as much ease and convince as any resident would avail a home loan. However some difference between the two kinds of loans exists in terms of tenure, documents, repayment etc. The home loan rate charged by an NRI does not differ much by the interest rate charged by an Indian for his home loan but the tenure for such loans differs to a great extend. NRI home loans are extended for much shorter period as compared to the normal home loan. The loans tenure for NRIs extends from 7years up to a maximum tenure of15years where as the maximum tenure for a resident is from 25 to 30 years. Also an NRI cannot opt for a loan tenure that exceeds beyond his retirement age or 60years, which ever is earlier.

Besides an NRI can only get 85% of the loan amount and the remaining 15% has to be brought himself by the borrower. This amount can be paid by the borrower through direct remittances from abroad via the normal banking channels, the Non-Resident External (NRE) account and /or Non-Resident Ordinary (NRO) account in India. The loan amount depends on the individual’s gross monthly earnings. This amount is normally up to 36 times of the gross monthly income but there is also a maximum limit on this amount.

Also the documents needed to provide for availing a home loan by the NRIs are different from the residents. They are required to submit additional documents, like copy of the passport and a copy of the works contract, power of attorney etc.

The repayment for an NRI home loan is done through EMIs that includes interest and principal amount calculated on the monthly basis. The borrower can pay the EMIs by issuing post-dated cheques from his (NRE)/ (NRO) or Non Resident (Special) Rupee Account (NRSR) in India or any other account approved by the Reserve Bank of India (RBI). Also for security purpose, banks stress on keeping the first mortgage of the property in their name and if the property is under construction then an additional security such as guarantee of third party is required. This third party can be both a resident and a non-resident of the country.

Home loans are eligible for tax rebate but NRI cannot claim this benefit on home loans in India as they are eligible to pay tax in the country in which they reside and work.

An NRI who wishes to avail a property back in India can accomplish his dream by relying on an NRI home loan. The aspects covered above would have cleared doubts about the sanction and availability of such a loan.

Mumbai developers to focus on NRI buyers in UAE

Mumbai (PTI): Real estate developers in the metropolis plan to target NRI buyers, primarily in the UAE, in a bid to push up their sales, affected in recent times by high prices and adverse sentiment, a senior industry official said.

“With the Rupee depreciating via-a-vis the dollar, NRI buyers stand to gain by around 20 per cent. Prices too have begin to decline. NRIs can get a good deal now and we intend to highlight this,” Maharashtra Chamber of Housing Industry’s CEO Zubin Mehta told PTI in Mumbai.

The Rupee had depreciated from the Rs 40 mark a few months ago to the Rs 50 mark against the dollar last week, a fall of over 20 per cent in the span of a few months.

The Rupee depreciation against the dollar would benefit NRI purchasers by around 20 per cent. Besides, prices have declined by 10-15 per cent in the last few days. If discounts by builders are also factored in, buyers could be advantaged to the tune of nearly 40 per cent, Mehta said.

“If a 2 BHK flat in a decent Mumbai suburb costs around Rs 50 lakh, it could be available to NRIs for around Rs 40 lakh. Factor in the price decline and if the builder offers a further discount or says the stamp-duty is for free, then the flat could be available for as low as Rs 35 lakh,” he said.

The MCHI intends to use the Rupee depreciation against the US dollar as a major selling point to NRI buyers. It would be a holding an exhibition in Dubai end-this month where major developers affiliated to the MCHI would be showcasing their properties.

“NRIs in the Gulf primarily look at ready property and these could now be easily available to them,” Mehta said. Mehta said that the main reason for targeting UAE NRIs was that they were mainly working-class people who have gone to Dubai and other places in the UAE with the aim of earning a living and buying a home in India.

“They are not permanent residents like in the US or the UK. They primarily earn their living in the UAE and buy a home in India,” Mehta said.

These NRIs have the money and are the actual buyers but are holding back on purchases hoping that prices would fall.

“Globally sentiments are low but we hope to change this,” he added.

Many MCHI members have already reduced their prices by 10-15 per cent, he said. Though he did not expect any further reductions, individual developers may offer discounts such as parking facilities for free or taking care of stamp-duty among other things, he said.

On interest rates being charged by home finance companies, Mehta said that “the industry would welcome a single-digit interest rate but at this time any reduction is more than welcome. It will help spur demand.”

“With real estate prices declining and interest rates also showing signs of softening, I expect business to pick up January onwards,” Mehta said.

Source : www.hindu.com

NRIs and PIOs can invest in real estate in India

Anon-resident Indian (NRI) and person of Indian origin (PIO) can acquire residential property in India. They can rent it out, transfer it, or sell it as well. They can take the rental income and their investments in the property out of the country , subject to the foreign exchange regulations.

Under the present relaxed conditions, NRIs can invest in property in India easily. A NRI is an Indian citizen residing outside India. A PIO is an individual who at any time held an Indian passport, or whose father or grandfather was a citizen of India. However , a PIO who is a citizen of Pakistan, China or Bangladesh has restrictions in acquiring property.

Also, NRIs and PIO cannot buy agricultural land, plantation property and farm house. A NRI/PIO may use his own funds to acquire immovable property. He can also avail a housing loan from a bank.

Own funds is money received in India through an inward remittance from overseas out of income earned overseas, personal savings outside India, and funds held in non-resident external (NRE), non-resident ordinary (NRO), or a foreign currency – non-resident (FCNR) bank account.

In addition to own funds, he may also avail a housing loan from a bank. The authorised banks have been permitted to provide housing loans to NRIs and PIO for acquisition of a residential property in India. It is to be noted that this is subject to certain conditions.

However , the quantum of loan, margin money and the period of repayment are on par with the housing loans provided to residents in India. The loan amount cannot be credited to the NRE/FCNR account of the NRI/PIO. It has to be fully secured through an equitable mortgage of the property proposed to be acquired.

If required , the bank may also have a lien on the other assets of the buyer in India. Further, the instalments of the loan, interest and other charges should be paid by the NRI/PIO through remittances from outside India through normal banking channels or out of funds in his NRE/FCNR/NRO account in India.

The loan and interest can also be repaid out of the rental income of the property purchased. The NRI/PIO may transfer the property without any approval from the Reserve Bank of India (RBI) to anybody – either a resident of India or another NRI/PIO.

In case the property is let-out , the rental income can be credited into the NRO/NRE account. In case of sale, the sale proceeds of upto two properties can be remitted outside India without any RBI approval. Remittance for third and subsequent properties requires an RBI approval .

The remittance of the sale proceeds depends upon the mode of acquisition – whether it was acquired out of funds remitted from outside or out of rupee funds. A property can be acquired out of rupee funds by a NRI before leaving India, or acquired after leaving India but from his savings bank account here.

It should be with income earned in India. The proceeds can be repatriated provided the amount does not exceed either the amount paid for acquiring the property in foreign exchange received from overseas, the amount paid from the FCNR account, or the foreign currency equivalent of the amount paid from the funds held in a NRE account .

In case the property is let-out , the rental income can be credited into the NRO/NRE account. In case of sale, the sale proceeds of upto two properties can be remitted outside India without any RBI approval. Remittance for third and subsequent properties requires an RBI approval .

The remittance of the sale proceeds depends upon the mode of acquisition – whether it was acquired out of funds remitted from outside or out of rupee funds. A property can be acquired out of rupee funds by a NRI before leaving India, or acquired after leaving India but from his savings bank account here.

It should be with income earned in India. The proceeds can be repatriated provided the amount does not exceed either the amount paid for acquiring the property in foreign exchange received from overseas, the amount paid from the FCNR account, or the foreign currency equivalent of the amount paid from the funds held in a NRE account .

Source : Economictimes.com

NRIs can invest in property in India

Anon-resident Indian (NRI) and person of Indian origin (PIO) can acquire residential property in India. They can rent it out, transfer it, or sell
it as well. They can take the rental income and their investments in the property out of the country, subject to the foreign exchange regulations.

Under the present relaxed conditions, NRIs can invest in property in India easily. A NRI is an Indian citizen residing outside India. A PIO is an individual who at any time held an Indian passport, or whose father or grandfather was a citizen of India. However, a PIO who is a citizen of Pakistan, China or Bangladesh has restrictions in acquiring property.

Also, NRIs and PIO cannot buy agricultural land, plantation property and farm house. A NRI/PIO may use his own funds to acquire immovable property. He can also avail a housing loan from a bank. Own funds is money received in India through an inward remittance from overseas out of income earned overseas, personal savings outside India, and funds held in non-resident external (NRE), non-resident ordinary (NRO), or a foreign currency – non-resident (FCNR) bank account.

In addition to own funds, he may also avail a housing loan from a bank. The authorised banks have been permitted to provide housing loans to NRIs and PIO for acquisition of a residential property in India. It is to be noted that this is subject to certain conditions.

However, the quantum of loan, margin money and the period of repayment are on par with the housing loans provided to residents in India. The loan amount cannot be credited to the NRE/FCNR account of the NRI/PIO. It has to be fully secured through an equitable mortgage of the property proposed to be acquired.

If required, the bank may also have a lien on the other assets of the buyer in India. Further, the instalments of the loan, interest and other charges should be paid by the NRI/PIO through remittances from outside India through normal banking channels or out of funds in his NRE/FCNR/NRO account in India.

The loan and interest can also be repaid out of the rental income of the property purchased. The NRI/PIO may transfer the property without any approval from the Reserve Bank of India (RBI) to anybody – either a resident of India or another NRI/PIO.

In case the property is let-out, the rental income can be credited into the NRO/NRE account. In case of sale, the sale proceeds of upto two properties can be remitted outside India without any RBI approval. Remittance for third and subsequent properties requires an RBI approval.

The remittance of the sale proceeds depends upon the mode of acquisition -whether it was acquired out of funds remitted from outside or out of rupee funds. A property can be acquired out of rupee funds by a NRI before leaving India, or acquired after leaving India but from his savings bank account here. It should be with income earned in India.

The proceeds can be repatriated provided the amount does not exceed either the amount paid for acquiring the property in foreign exchange received from overseas, the amount paid from the FCNR account, or the foreign currency equivalent of the amount paid from the funds held in a NRE account.

In case the property is acquired from rupee funds held in India, the remittance depends on the holding period of the property. In case the property has been held for more than 10 years, up to one million USD per calendar year can be repatriated without any RBI approval.

If the property is sold after being held for less than 10 years, remittances can be made if the sale proceeds were held for the balance period in a NRO account or other eligible investments.

For remittance of sale proceeds of assets acquired through inheritance or settlement, there is no lock-in-period. In all other cases, specific approval of the RBI is required.

Wherever a specific approval of the RBI is not required, the sale proceeds of the property as well as the rental income may be remitted outside India through normal banking channels, after obtaining an appropriate certificate from a chartered accountant, certifying that applicable taxes have been paid or provided for.

Source : Economictimes.com

Investment opportunities for NRIs

India is emerging as one of the most exciting markets in the world for foreign investments. India’s dynamic and highly competitive private sector has been the backbone of its economic activity and offers considerable scope for foreign direct investment. Karishma Julka and Anju Thukral from Ernst & Young highlight the various Investment opportunities that are available to a Non Resident Indian (NRI) in India.

As per the Foreign Exchange Management Act, 1999 (FEMA), NRI means a person resident outside India who is an ‘Indian citizen’ or a ‘Person of Indian Origin’ (PIO). FEMA broadly covers all matters related to investment avenues for NRIs such as investment in immovable property, foreign exchange, bank deposits, government bonds, investment in shares, units, securities, and foreign direct investment in India.

While NRIs can invest in India as per the FEMA rules, the tax implications under the Income tax Act, 1961 (Act) for the income generated from investments in India; and regulations governed by the Reserve Bank of India (RBI) will have to be kept in mind.

Investment opportunities available to NRI’s

Primarily, NRIs can make investments directly in areas covered under the automatic route (i.e. areas where no specific approval is required by RBI), either through direct remittance from abroad or through the authorized dealers (eg banks). For areas not covered under the automatic route, a specific approval from RBI or other specified authorities is required.

RBI regulations permit NRIs to open and maintain rupee accounts like the NRE a/c (Non – Resident (External) Rupee a/c), NRO a/c (Ordinary Non-Resident Rupee a/c), or FCNR a/c (Foreign currency (Non – Resident) Accounts) with any recognized authorized dealer in India.

The investment opportunities available to NRIs are endless. Some of them are mentioned below:

• Government securities or Units of UTI through authorised dealers. Units can also be directly purchased from UTI.
• National Savings Certificates
• Portfolio investments i.e. purchase of shares / debentures of Indian companies through stock exchanges in India. This facility is granted both on repatriation and non repatriation basis.
• Investments in Mutual Funds
• NRI’s holding Indian passports and persons of Indian origin enjoy parity of status. Therefore they can invest or inherit immovable property subject to certain exceptions and prescribed conditions. Housing finance companies and banks have been permitted to offer home loans to NRI and they can repay home loans through inward remittance using normal banking channels or by debit to his NRE/FCNR(B)/NRO account or out of rental income derived from renting out such property.

There is no lock-in period with regard to immovable property that is inherited however, repatriation of funds from a residential property is restricted to a maximum of two properties only.

Some of the areas where investments are restricted for an NRI include agriculture, plantation and construction of farm houses.

NRIs are also allowed to transfer as gift any residential/commercial property in India to a person resident in India or to an NRI or PIO subject to certain exceptions, and the sale proceeds of the property received as gift will be credited only to an NRO account. There is no lock-in period for sale of residential/commercial property. NRIs can remit abroad an additional amount up to $1 million per year from the sale of immovable property in India, subject to certain conditions.

NRIs have the option to freely sell any shares, bonds and debentures acquired on non-repatriation or repatriation basis under both Direct Investment Scheme and Portfolio Investment Scheme. NRIs can also gift shares and securities to resident relatives; however, gifting to non-resident relatives (other than NRIs) would require RBI’s permission. Sale/transfer of shares/securities to other NRIs does not require RBI’s permission.

Once the area of investment has been decided, it may be prudent to know the taxability of income from such investments.

Taxability of income in India depends on the residential status of the NRI under the Indian Income tax Act. One of the key points to remember is that the residential status in this regard is determined as per the Income tax Act, which may be different from the residential status determination under FEMA.

In case of a Non Resident, only income received in India, or accrued in India, or income deemed to accrue or arise or receive in India, is subject to tax in India. It is also worthwhile to note that in order to promote investment in India by NRIs, Government of India has initiated various tax-friendly schemes like NRI Bonds, Millennium Deposits etc. where the interest income earned is tax exempt.

India has opened its doors and liberalized regulations relating to foreign exchange and remittance of funds from India. There are various opportunities beckoning NRI’s however, every investment, no matter how lucrative, should be carefully analysed to ensure compliance with the Indian laws both from an exchange control and tax perspective.

Economictimes

Gurgaon gives Sops to Overseas Citizens of India

Offering sops of sorts, the district administration on Tuesday announced it would issue Indian driving licenses to Overseas Citizens of India (OCIs), putting them on par with non-resident Indians (NRIs).

Children of OCIs can also be enrolled in any educational institution here, just like NRI children are. Foreign nationals are denied this option, and their children can only study in international schools, or study in approved universities under mutually agreed quota system.

With this, Gurgaon has become one of the select cities to put in place a mechanism that brings some sort of parity in status between OCIs and NRIs.

OCIs are people of Indian extract but are citizens of another country, and hold an OCI card under a special scheme introduced in 2006.

NRIs, also settled abroad, on the other hand may or may not be citizens of the country they are settled in; they definitely do not hold an OCI card.

Now, anyone holding an OCI card in Gurgaon is entitled to both options – enrolment in schools and driving licenses – which the NRIs enjoy during their stay in India, district magistrate Rakesh Gupta said.

The registration booklets they hold will be treated as their identification proof, Gupta added.

Gurgaon is dotted with multinational companies (MNCs) employing both foreign nationals as well as people of Indian origin from various countries who hold OCI cards; their stay could be either for business purpose, or because of the project period of the company they work for.

Under the OCI scheme, persons of Indian origin from any country (except Pakistan and Bangladesh), who were once citizens of India, or were eligible to become citizens of India on January 26, 1950, under the Citizenship Act 1955, are eligible to become OCIs.

OCIs are not required to report to the police or other foreign office for any length of their stay in India, nor do they require employment visa to work in the private sector here. However, OCIs do not have political rights and are not allowed to hold government jobs. Additionally, they cannot acquire agriculture and plantation properties.