A significant number of real estate investors in India are NRIs. This is primarily because they can earn a huge return on investments from this. An NRI can invest in both commercial and residential properties in India, but they are restricted from purchasing farmland, agricultural land, and plantation. NRIs can possess them if they get such properties through gift or inheritance.
Few vital points an NRI requires to remember when making a realty investment in the country.
- The power of attorney is necessary by NRIs if he/she could not be present in India physically for the carrying out of property deals. It authorizes a person to act on behalf of another. Responsibility is passed on and, thus, assists NRIs to manage their assets in India professionally. POA can be used for purposes primarily associated with the lease, mortgage, collect rent, sell, and manage, borrow, and sale disputes, perform acts necessary by banks and enter into contracts. The government is planning to alter the laws to make registration compulsory for such deals which will help restrain frauds, disputes, and stamp duty avoidance.
- Investing in real estate in India is no more as challenging as it used to be. Most NRIs today believe that the recent regulatory changes in India have made the sector more well-organized and see-through, rendering the environment favorable enough for investment in property. An NRI investing in India needs to have a checklist of things which must comprise property verification, KYC, list of all documents, tax implication legalities, payment plan, and other local formalities and someone reliable to help ease the whole process so that it is efficient and smooth.
- India has double taxation avoidance agreements with over ninety countries. An NRI can claim a tax credit on taxes paid by him in the country on income from property in his nation of dwelling. The NRI is accountable to pay tax on the total of capital gains arising in India. A rigid property held for over 24 months is treated as a lasting capital asset and gets the indexation benefit with taxation at 20%.
- Real estate transactions in India for NRIs fall in the purview of FEMA. RBI has cut down the rules as NRIs holding an Indian passport needs no consent while investing in real estate. Under the general permission group, persons of Indian origin necessitate no approval unless they are citizens of adjoining countries. They can make payment through inward remittance, NRE accounts, NRO accounts or FCNR deposit accounts. Any property investment comprises registration charges, stamp duty, and service tax to be paid as per the Indian laws. NRIs are eligible to apply for loans in India but should reimburse the loan in Indian rupees only.
- NRIs can buy any number of properties, both commercial and residential. But they are not permitted to purchase any form of plantation property, farmhouse, and agricultural land unless it has been inherited or gifted by them. The regulatory environment and depreciating rupee value after the accomplishment of changes are endorsing a huge number of NRIs to invest in the realty market of India.
Things to consider when giving a 1bhk flat on rent in Noida, India:
Maximum individuals will agree that offering a house on rent is not a simple task. It could become a serious headache if not handled appropriately. The common issues comprise searching for new tenants every few years, mistreatment of the premises by the tenant or his denial to vacate, postponement in payment of rent and nonpayment of maintenance fee on time. The points that an individual should keep in mind while giving 1 BHK flat in Noida, India on rent so that they can avoid hassles later are explained below:
- Deciding rent
The initial step is to ensure the correct rent amount. It is vital as in such a competitive market you cannot ask for more than the market rate. Doing so will postpone prospective tenants. However, if your house is better furnished and maintained than that of others, you can charge a premium. If the furnishings are superb, you can ask for a premium but may have to wait longer to find a renter. For floors or independent houses, it is tricky, but you can verify the rent of close by properties and get there at an estimated rent per square feet figure and be relevant it to your property.
- Preparing lease contract
A rent agreement is a lawful document that binds the tenant and the landlord to abide by the mutually-settled conditions. It is the most vital document in case of a disagreement between the two. Thus, utmost care should be taken in drafting the document. It should state all terms and conditions clearly to avoid any argument in the future.
- Register the lease
When giving 1 BHK flat in Noida, India on rent, after the lease agreement is prepared, it is important to get the task registered.
- Police verification
This helps in the background check of the renter. Not doing this is a punishable offense under Section 188 of the Indian Penal Code. This reduces the risk that the house is not being rented out to a person with a criminal background. For this, the landlord just has to fill the verification form and submit it to the local police station together with identification proof of the tenant. The forms are present online on websites of state police departments.
Apart from the above, the landlord when giving 1 BHK flat on rent in Noida, India should visit the premises periodically to check whether the tenant is violating any condition or if he has sublet the property. If yes, he can demand that he evacuate the house. If the tenant denies vacating, the landlord can approach the authority which manages disputes related to renting with all the documents.
Housing.com is a reliable real estate search portal that offers comprehensive details for properties available on rent with genuine photos and complete information.