Buying land or property in India, pitfalls or bonuses, experience requested?

#1 Oct 14th, 2016, 05:24
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#1
Maybe this might be a good discussion. I have seen a great little patch and small basic house for sale for 3 Lak.

I would very much like to buy and own the property.

However, has anyone any experience with such a transaction and aware of any pitfalls or risks to watch out for?

I have never owned a property before and experienced knowledge and advice would be very much appeciated.

I'll let this run and see what I can learn.

Thank you.
#2 Oct 14th, 2016, 09:19
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If its like Mexico fraud, violence, and encroachment are the norm..
#3 Oct 14th, 2016, 09:43
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#3
Quote:
Originally Posted by boatmasterlondon View Post Maybe this might be a good discussion. I have seen a great little patch and small basic house for sale for 3 Lak.

I would very much like to buy and own the property.

However, has anyone any experience with such a transaction and aware of any pitfalls or risks to watch out for?

I have never owned a property before and experienced knowledge and advice would be very much appeciated.

I'll let this run and see what I can learn.

Thank you.

That sounds very very cheap for Kerala. How big is the house, how big is the plot of land on which the house sits.

Make sure that the person selling has the right to sell, and there are no dues on the house.

To be honest it sounds too good to be true.
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#4 Oct 14th, 2016, 13:53
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#4
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Originally Posted by boatmasterlondon View Post I would very much like to buy and own the property.
You are aware of the necessary qualifications for owning "immovable property" in India, and you meet the requirements?

Pitfalls and dangers... about the same as buying a second-hand car in the lower end of the London market.
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#5 Oct 14th, 2016, 14:26
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#5
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Originally Posted by boatmasterlondon View Post I would very much like to buy and own the property.
Do you have a residency permit?
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#6 Oct 14th, 2016, 16:31
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Do you have a residency permit?
Strange though it may seem, that is not the right question, because qualification to buy land is not based on that kind of "residency!"
#7 Oct 14th, 2016, 16:42
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Did not understand you Nick.

I am not knowledgeable enough on these matters, but I think a minimum stay of 183 days is required to buy land, which you can only do as a 'person resident in India'
#8 Oct 14th, 2016, 18:36
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My point is that residence for fiscal purposes is different to residence for immigration purposes, which may or may not include a piece of paper called "RC/RP) (Registration Certificate/Resdents Permit). BML might have an RP/RC at this time: it would not, of itself, qualify him to buy land.

The arrangement of the RBI FAQs which covered this has changed a lot since I last looked, and I cannot easily find the answer. Possibly that might have changed too! But it was something like resident in India for 183 days in the previous tax year.
#9 Oct 14th, 2016, 18:56
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#9
I've read that a Director of an Indian Company PLC can buy " One " property only.

This little place is around 40 foot x 60 foot.
5 mins from the beach.
Being sold at local price, not a foreign tourist price, so wanna snap it up quick.

Hence me wanting to get my DIN sorted ASAP and get my name on the Company registration papers.
#10 Oct 14th, 2016, 20:27
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#10
Quote:
Originally Posted by boatmasterlondon View Post I've read that a Director of an Indian Company PLC can buy " One " property only.

...
Try and give a source for where you read that. It'll help others give you more useful advice here.

Go through a trusted lawyer screened by yourself and appointed by you to represent just your interests. The property deed has to be registered with the local Registrar.

The rules governing the ownership (acquisition, holding and disposal) of immovable property by foreigners in India are governed by the:

RBI (Reserve Bank of India) and the

FEMA (Foreign Exchange Management Act).

In particular, read:
Frequently Asked Questions - Purchase of Immovable Property

Quote:
Part II. Purchase of immovable property in India by Non-Resident Individuals

These FAQs attempt to put in place the common queries that users have on the subject in easy to understand language. However, for conducting a transaction, the Foreign Exchange Management Act, 1999 (FEMA) and the regulations made or directions issued thereunder may be referred to. The relevant principal regulations are the Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2000 issued vide Notification No. FEMA 21/2000-RB dated May 3, 2000. The directions issued are consolidated in Part II of the Master Direction No 12 on Acquisition and Transfer of Immovable Property under Foreign Exchange Management Act, 1999. Amendments, if any, to the principal regulations are appended.

Q1. How can Non-resident Indians (NRIs) / Persons of Indian Origin (PIOs) acquire immovable property in India?
Q2. What are the accepted modes of payment for property acquired in India?
Q.3 Can Foreign Embassies/ Diplomats/ Consulate Generals acquire property in India?
Q.4 Can foreign nationals acquire property in India?
Q.5 Can a non-resident repatriate the sale proceeds of immovable property in India?

Q.6 What is the meaning of transfer?

...

Q4. Can foreign nationals acquire property in India?

Answer:

Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan, Macau or Hong Kong, irrespective of their residential status, cannot, without prior permission of the Reserve Bank, acquire or transfer immovable property in India, other than on lease, not exceeding five years.

Foreign nationals of non-Indian origin resident in India (except 10 countries listed at (a) above) can acquire immovable property in India.

Foreign nationals of non-Indian origin resident outside India can acquire/ transfer immovable property in India, on lease not exceeding five years and can acquire immovable property in India by way of inheritance from a resident. All other acquisitions/ transfers will require the prior permission of RBI


#11 Oct 14th, 2016, 20:36
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#11
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I've read that a Director of an Indian Company PLC can buy " One " property only.
The thing with loopholes that are really really easy is that they are usually not real. I do not know about this one, but if true, how come Goa wasn't/isn't full of company directors?

I don't know about this one. I got to the point where I know I could own property here (actually I don't: my wife "owns" the house) and forgot about it all. Please consult the RBI pages on this, and even the source legislation, which is called FEMA.

40 * 60 is 2400 sq feet, other wise known as 1 ground. If a one-ground property can be had, five minutes from a Kerala beach for 3 Lakh, then, even now, I want one. When I was actually looking, seven or eight years ago, I think I only saw stuff five to ten times that price (Backwaters, not beach) or tiny. Or very undesirable in some way. And yes, we were working through a local.

Anyway, good luck!
#12 Oct 14th, 2016, 20:55
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#12
Oh, I can certainly confirm that the property might be undesirable to some. Lol

But to me, I like the basic living.
#13 Oct 14th, 2016, 22:45
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#13
Is the location undesirable?

Unless buildings new[ish] or special in someway, it is land that has the value and what people pay for, so the house may be a dump, a shack, or even a hut: the value will be in the land.
#14 Oct 15th, 2016, 09:25
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#14
Quote:
Originally Posted by boatmasterlondon View Post I've read that a Director of an Indian Company PLC can buy " One " property only.

This little place is around 40 foot x 60 foot.
5 mins from the beach.
Being sold at local price, not a foreign tourist price, so wanna snap it up quick.

Hence me wanting to get my DIN sorted ASAP and get my name on the Company registration papers.
In Kerala land is measured in cents. 1 cent is 100th of an acre and approx 435 sqft. So you are looking at buying approx 5.5cents.

Assuming you can buy the land make sure that you do pay at least the minimum amount stated by the government.

Now what happens if you lose your directorship. Don't think that this will never happen.

You shoud try and get an encumbarance certificate. This will tell you of all the previous owners for the past thirty years.
#15 Oct 15th, 2016, 11:23
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I hope this land you propose purchasing has access.

It could be in a field with no access at all.

Anaway i thought you were going to purchase a tricycle with something on the back that you could call home. If that were made of metal I'm surprised you are still here, you could have been fried alive in the hot Keralan sun


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