Pune remains one of the most popular Indian cities for NRI property investment — driven by its IT economy, strong rental demand, and family ties for many buyers. Here's what NRIs should know before purchasing.
Can NRIs Buy Property in India?
Yes. Under FEMA (Foreign Exchange Management Act) regulations, NRIs and OCIs (Overseas Citizens of India) can freely purchase residential and commercial property in India. The main restriction applies to agricultural land, farmhouses, and plantation property, which NRIs generally cannot purchase.
Documentation NRIs Typically Need
- Valid passport (and OCI card, if applicable)
- PAN card — mandatory for any property transaction in India
- Overseas address proof and Indian address proof (if available)
- Power of Attorney (POA), if you won't be physically present for the transaction — this needs to be properly notarized and, in many cases, attested by the Indian consulate
- NRE/NRO bank account details for the transaction
How Payments Work
Property payments must be made through banking channels — not cash — and typically from an NRE (Non-Resident External), NRO (Non-Resident Ordinary), or FCNR (Foreign Currency Non-Resident) account. Home loans are also available to NRIs from most major Indian banks, generally requiring additional documentation like overseas income proof and employment verification.
Repatriation: Getting Your Money Back Out
If you eventually sell the property, repatriation of sale proceeds is allowed, subject to conditions:
- The property must have been purchased in accordance with FEMA regulations
- Repatriation of the original investment amount is generally allowed if funded through an NRE account or foreign inward remittance
- There are annual limits on repatriable amounts, and any capital gains are subject to Indian tax before repatriation
It's advisable to consult a chartered accountant familiar with NRI taxation before initiating repatriation, since the rules involve several conditions.
Tax Considerations
- TDS on sale: If an NRI sells property, the buyer is required to deduct TDS at a higher rate than for resident sellers — this is a common surprise for NRI sellers if not planned for in advance
- Rental income: If the property is rented out, rental income is taxable in India, and NRIs can claim standard deductions similar to resident taxpayers
- Double Taxation Avoidance Agreement (DTAA): Many NRIs can offset Indian tax liability against tax owed in their country of residence, depending on the applicable DTAA
A Practical Tip for NRI Buyers
Since NRIs often can't personally inspect construction progress or manage local paperwork in person, working with a developer who has a strong, transparent track record — and communicates proactively — matters even more than it does for resident buyers. Ask specifically about the developer's experience working with NRI clients, including how site updates and documentation are typically handled remotely.
