Classifieds | Archives | Jobs | About TGT | Contact | Subscribe
Last updated 7 hours, 48 minutes ago
Printer Friendly Version | TGT@Twitter | RSS Feed |
V Nagarajan: NRIs can continue to hold inherited properties
March 12, 2017
 Print    Send to Friend

Exclusive to The Gulf Today

I inherited immovable property from my family member in India and subsequently migrated to Gulf. Can I continue to hold the property or are there any restrictions? Kindly clarify. Rathish, Ajman
You can continue to hold the inherited property from your family members and there is no impediment. The provision under section 6(5) of FEMA facilitates the ownership and transfer of immovable property inherited from family members in India.

I am selling my property in Bengaluru and planning to repatriate the sale proceeds abroad. What is the quantum of amount that I can repatriate out of sale proceeds received in India? Please clarify. Abishek Singhvi, Sharjah
Assuming the property was acquired in accordance with the provisions of FEMA regulations, the amount to be repatriated should not exceed (a) the amount paid for acquisition of the immovable property in foreign exchange received through normal banking channels or out of funds held in FCNR account or (b) the foreign currency equivalent as on the date of payment of the amount paid where such payment was made from the funds held in NRE account for acquisition of the property.

In the case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties. Authorised dealers may allow the facility of repatriation of funds out of balances held in their NRO account upto $1 million per calendar year, including sale proceeds of immovable property.

I may represent Indian builders to market their projects across UAE. What is the permissible commission allowed by the government regulations for agents marketing Indian property abroad? Jayasuresh, Dubai.
The permissible limit is five per cent of the inward remittance or $25,000 whichever is higher, per transaction. Remittance by way of commission to agents abroad for sale of residential flats/commercial plots in India, exceeding five per cent of the inward remittance requires Reserve Bank of India’s approval. Authorised dealers may freely allow such remittance.


Affordable housing

The participation of organised real estate developers would increase in the affordable housing segment with various tax incentives announced in the Budget, according to ICRA report.

The key measures taken include giving infrastructure status for affordable housing segment, relaxation of criteria for eligibility for tax benefit under Section 80IBA and higher allocation for the Pradhan Mantri Awas Yojana (PMAY).

For a representative affordable housing project with execution cycle of 3.5 years and profit before tax (PBT) margins of 16 per cent, the tax exemption would result in a boost to the equity IRR (internal rate of return) by around 3 per cent. Eligible beneficiaries in the MIG category (first time buyers only) can have a maximum annual income of Rs 18 lakh and will receive interest subsidy of 3 per cent for principal up to Rs 12 lakh for 20 years.

This move is expected to significantly increase the number of people eligible for receiving credit linked subsidies and drive demand for affordable housing projects. Real estate sector is expected to witness boost in investments on the back of recent regulatory reforms, according to KPMG India report.

The government has announced key policies for real estate in the Union Budget for 2017-18. Within real estate, affordable housing now gets an infrastructure status. There is also relaxation on area measurement and a higher allocation of funds to the NHB. These announcements are a definitive positive sign for the sector where easier access to credit has been an obstacle for some time, the report said.

Further, policy announcements like Real Estate Regulation Act made in 2016 coupled with deadline imposed on state governments to implement the same can go long way in easing consumer concerns around project delivery and curbing of malpractices in the sector. All of this is expected to lead to a significant clean-up in the sector, making it attractive for institutional players. In 2016, a total of $1.8 billion was raised by real estate-focused private equity funds in 2016.

Follow on Twitter
The author is a business analyst
covering Indian property markets

Add this page to your favorite Social Bookmarking websites
Post a comment
Related Stories
V Nagarajan: Impact of Goods and Services Tax on Indian residential projects
I am planning to invest in a residential project in Bengaluru? Is GST applicable to all types of residential projects? Please clarify. Pradeep, Dubai. The impact of Goo..
V Nagarajan: Property investment can be made in names of two or more family members
Our family is planning to make substantial investment in real estate in the names of family members. Is individual investment or joint investment an ideal option from the..
V Nagarajan: New regulations for developing real estate projects in Karnataka state
I have invested in plotted development project in Bengaluru, Karnataka state, India. But the project is yet to be completed. As the new regulation has come into force, w..
V Nagarajan: A ‘Will’ does not require compulsory registration in India
My relative has left a ‘Will’ bequeathing his immovable property in India. However, I understand it has not been registered. Is registration of Will compulsory? Jayasures..
V Nagarajan: Easing of norms for developers of affordable housing
We are a group of NRIs planning to enter into development of affordable housing in select Indian cities due to fiscal sops provided in the budget. Are these benefits subs..
Advertise | Copyright