Ask a group of NRIs why they have not bought a home in India yet, and you will hear the same handful of reasons. Some were true twenty years ago. Most are not true now. Here are seven, checked one by one.
Myth 1: "I have to be in India to buy"
You can complete most of the process from abroad. Bank payments are online. Documents can be couriered. For registration, a trusted family member can sign for you with a power of attorney limited to the property. Many people do fly in once, for peace of mind, but it is not required.
Myth 2: "Builders take the money and disappear"
That fear is the reason the RERA Act, 2016 exists. Projects above a certain size must register with the state regulator. Seventy per cent of buyers' money has to sit in a separate account for that project. Plans, completion dates and quarterly progress are public. You can check all of it on rera.karnataka.gov.in before you pay a rupee.
Myth 3: "NRIs cannot get a home loan"
They can. Indian banks and housing finance companies routinely lend to NRIs. Expect more paperwork: your employment contract, salary proof, passport and visa. The idea is the same as for any buyer: keep the EMI to an amount you can manage in a bad month. Try your numbers in our EMI calculator before you apply.
Myth 4: "My money will be stuck in India forever"
Not if you keep your records. When you buy with money brought in from abroad, FEMA rules allow you to send the sale proceeds back for up to two residential properties, up to what you brought in. The key is paying through proper banking channels and keeping every bank advice.
Myth 5: "Looking after a flat from abroad is impossible"
It is easier in a gated community with an owners' association and on-site maintenance. Day-to-day issues go to the facility team, and big decisions come to you by email. If parents or relatives live there, it is easier still.
Myth 6: "Only big-budget buyers get a good builder"
A trustworthy builder is not only for premium homes. Look at what matters: RERA registration, delivered projects you can visit, Occupancy Certificates before handover, and a clear cost sheet. Reeva Properties was set up to bring SUYUG Infra's build quality to homes within reach of first-time buyers.
Myth 7: "If a broker says it is verified, it is"
"Verified" on a listing means nothing legally. Do your own checks: look up the RERA number yourself, ask a lawyer to read the title, and compare carpet area, not "super built-up" area.
What NRIs can and cannot buy
Under FEMA, the Foreign Exchange Management Act, 1999, and the rules made under it, an NRI can buy residential and commercial property in India. An NRI cannot buy agricultural land, a plantation property or a farmhouse, except by inheritance. A flat or a family home in an approved residential project is squarely allowed.
How the money must move
- From abroad, through normal banking channels, into the seller's account in India.
- Or from your NRE, NRO or FCNR(B) account held in India.
- Not in foreign currency notes, travellers' cheques or cash.
Keep the bank advice for every payment. It is your proof of how the home was paid for, and you will need it if you ever sell and send money back.
A worked example: the down payment from abroad
Illustrative figures only, including the exchange rate. Say you and your spouse in the US are buying a family home with a value of ₹75 lakh. RBI's loan-to-value cap for ₹30–75 lakh is 80%, so the bank can lend up to ₹60 lakh and you fund ₹15 lakh.
- If ₹85 buys one US dollar, ₹15 lakh is about $17,650.
- Stamp duty and registration come on top. If they came to 6% of value, that is another ₹4.5 lakh, or about $5,300.
- Your loan EMI would be paid in rupees, usually from an NRE or NRO account.
Exchange rates move. A plan that works only at one rate is too tight.
Buying from abroad, step by step
- Shortlist and verify. Look up each project's RERA registration and recent quarterly updates.
- Get your loan in principle from an Indian lender that lends to NRIs.
- Visit, or send someone you trust, to see the site and a delivered project by the same builder.
- Book in writing. RERA section 13 says a promoter cannot take more than 10% of the cost as an advance or application fee without first entering into a written agreement for sale and registering it.
- Have a lawyer review the agreement and title documents.
- Sign a specific power of attorney, if you will not be present for registration. It should name the property and the acts allowed. If signed abroad, it is usually attested at the Indian embassy or consulate and must be stamped in India within the time allowed.
- Pay only through banking channels and file every receipt.
Common mistakes NRIs make
- A general power of attorney. Give a narrow one for this property only.
- Paying from a relative's account. The money trail should start with you.
- Not getting a PAN. You will need one for the purchase, the loan and any later sale.
- Ignoring the tax on rent. If you let the flat, the tenant generally has to deduct tax at source before paying rent to an NRI. Agree this upfront.
- Losing the paperwork. Scan everything into one folder, with the bank advice for each payment.
Managing the home once it is yours
- Register with the owners' association and give them an email address you check.
- Set up standing payments for maintenance and property tax from your Indian account, so nothing lapses.
- Insure the home and its contents if it will be let out or left empty for long.
- Use a written rental agreement if you let it, and keep a copy of the tenant's identity proof.
- Keep one person locally who can let in a plumber or electrician when needed.
Working with family in India
Many NRI buyers rely on a parent or sibling for site visits and paperwork. That works well with a little structure. Agree in advance what they can decide on their own and what must come to you. Share one folder of documents that both of you can see. Ask them to send photos or a short video after each site visit, and keep all payment decisions with yourself. Clear roles protect the relationship as much as the purchase.
If your family member will live in the home, decide early whose name the electricity, water and association records will be in, so bills and notices reach the right person.
Your NRI checklist
- PAN in hand
- NRE or NRO account active
- RERA registration checked online
- Loan sanction in writing
- Property-specific power of attorney, if needed
- Every payment through a bank, with advice saved
What is actually worth worrying about
The real risks are ordinary ones: buying more home than your EMI can carry, trusting a promise that is not in the agreement, or skipping the legal check to save time. Fix those three, and the rest is paperwork.
Starting out? Our first home guide walks through the basics.