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Making India home

Finding accommodation in India is relatively straightforward, but international travellers who are planning to relocate to India should seek housing advice from their employer and use a recommended lettings agency that specialises in expatriate accommodation.

There are some great blogs that offer insight into life as an expat in all the major cities in India and most cities have expat networking and support organisations (contactable online) that will help newcomers meet other expats, find out about local amenities, understand the local culture, and settle in.

There are a few things that new arrivals to India should know prior to arriving that will make the first few days and weeks less stressful:

  • Expats are expected to employ local domestic staff, usually a cook, driver, and cleaner. Ask your employer or local expat network group for recommendations, as Indian domestic staff will generally be experienced at accommodating the needs of new arrivals (in terms of food preparation, shopping needs, etc.) and will help ease your transition into life in India.
  • The electricity supply in India is 220 volts, so electrical items that are brought from outside of India should be checked to ensure that that can run on a 220V supply. The supply of electricity can be erratic, so voltage stabilisers should be obtained in advance to protect your electrical appliances and accommodation should be supplied with a back-up generator in case of supply failure.
  •  It is worth getting a set of passport-sized photos printed as soon as you arrive, as these (along with photo ID) will be required in order to secure any personal or domestic contract, e.g. mobile phone, propane gas delivery, accommodation lease, etc.
  • Unfurnished accommodation in India means that the house/flat will be literally bare — there will be no white goods, no air conditioning units, no cooker/oven etc. So these additional purchase costs should be borne in mind. If the quality of the furniture and fittings in a furnished accommodation looks poor, do not be afraid to ask for them to be replaced prior to signing the lease.
  • Western-style supermarkets tend to be considerably more expensive than local shops, so it is worth finding out in advance which local shops offer home delivery and arranging for a pre-paid delivery of all your home essentials for your day of arrival. If you are unable to find out the information in advance, be sure to ask your neighbours as soon as you arrive, to ensure that you get the products you need at the best possible price, delivered straight to your door. 
  • When shopping, ripped or damaged banknotes should not be accepted, as many retailers will refuse to accept them. They should be politely handed back and non-damaged replacements should be provided.

Buying property

The cost of purchasing, compared with renting, is relatively high, and coupled with the fact that most expats in India only stay for two to six years, the majority prefer to remain in high-quality but low cost rental accommodation for the duration of their stay. However, it is possible for non-Indian residents to purchase residential property in India, although the rules can be complex and the potential pitfalls are numerous for the uninitiated.

The laws around the purchase of ‘immovable property’ in India are relatively numerous and foreigners wishing to purchase a home in India must be able to prove that they meet the stipulations and criteria of both the Foreign Exchange Management Act (FEMA) and the Reserve Bank of India (RBI) Property Regulations, which stipulate (amongst other things) that non-Indian nationals must be normally resident in India in order to qualify, i.e. they must have a contract of employment that provides a visa with residency status. Purchasing a property whilst not meeting the criteria laid down by the Indian government (whether undertaken knowingly or not) is a criminal offence; furthermore, it can result in prosecution and confiscation of the property without financial recompense.

It is therefore vital that expats wishing to buy property in India seek the advice of a recommended and independent legal advisor. Note: The British High Commission (and similar consular services from other countries) is unable to offer legal advice, but will usually hold lists of registered and approved lawyers. When purchasing property in India as a foreign national, the following safeguards are strongly recommended:

  • Always seek and follow the advice of a local, independent lawyer rather than using one suggested by the vendor.
  • The services of the Public Notary (PN) will be required, but buyers should note that the PN will not be acting for you, cannot give advice, and is there to ensure that any purchase follows the correct legal procedures.
  • Always use a recommended and locally well-respected estate agent — seek personal recommendations from amongst the local expat network.
  • Ensure that your lawyer confirms in writing that there is no mortgage or other debt secured on the property due for purchase and that the deeds are registered to the vendor.
  • Consult a lawyer and the RBI in advance of signing an Agreement of Sale document to ensure that property registration will be unproblematic.
  • Inform the RBI of your intention to transfer a large sum of money into the country, transfer the money according to the rules laid down by the RBI, and make the transfer electronically.
  • Never pay cash for a property purchase and never attempt a property purchase without local, independent legal assistance.

It is worth noting that property cannot be bought jointly by one qualifying purchaser and another non-qualifying one. So, if the spouse of a foreign national living in India as a dependent does not have residential status, they will be unable to have their name registered on the property deeds. Also, whilst standard domestic properties can be bought by foreign nationals, it is almost impossible for non-Indian nationals to purchase agricultural land, plantations, or farmhouses. Similarly, commercial office accommodation can only be bought by companies registered in India, so these (effective) exclusions should be borne in mind. Finally, whilst it is legal for foreign nationals to purchase multiple residential properties in India, rental income derived from the letting of such properties must be paid into an Indian (rupee) bank account, rather than an overseas account.

Costs associated with residential property purchases

As in other parts of the world, the costs associated with property purchase in India will vary depending on, for example, the type and value of the property being bought. The table below provides a guide to the costs associated with an ‘average’ property purchase by a non-Indian national of a property worth Rs 1.66m

Average Costs of Residential Property Purchase in India ($250,000 or £205,000) and paid for in cash:

  • 5 - 7% Registration Fees
  • Estate Agent Fees 1 - 2% (plus VAT)
  • Legal Services 1.5%
  • Total Average Costs: 7.5 - 12.5%

There may be additional ‘hidden costs’ associated with a property purchase, for example, the additional cost of a designated car parking space and up-front building maintenance costs.

Don´t forget about taking care of yourself with good private health insurance in India, as the local hospitals are poorly financed by the governments and often struggle to take care of the patients.

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