NRI Guide to Buying Property in India 2026: FEMA, Repatriation, POA & TDS

UrbanYardz Editorial · NRI · 2026-06-19

NRI buying property in India? 2026 guide to FEMA rules, repatriation limits, Power of Attorney, TDS and home loans — verify current rates.

For Non-Resident Indians, owning a home back in India remains both an emotional anchor and a sound long-term asset. But NRI buying property in India is governed by a distinct layer of rules — FEMA, RBI directions, TDS provisions and Power of Attorney formalities — that resident buyers never encounter. This 2026 guide walks you through what you can buy, how to fund it, how to repatriate proceeds, and the tax checkpoints you must clear, so your purchase is clean from registration to repatriation.

Who Counts as an NRI or OCI, and What Can You Buy?

Your eligibility depends on your residency status under FEMA, 1999. An NRI is an Indian citizen residing abroad; an OCI (Overseas Citizen of India) holds an OCI card. Both enjoy broadly the same property rights.

You may freely buy:

Residential property (flats, builder floors, villas)
Commercial property (offices, shops, units)

You may not buy without specific RBI approval:

Agricultural land
Plantation property
Farmhouses

These restrictions hold even when you are tempted by a "great deal" on farmland near a growing city. You can, however, inherit agricultural land from a resident relative — but selling or repatriating from it carries its own conditions, so take advice first.

> As of 2026, the broad framework above is stable, but FEMA notifications are periodically amended. Confirm your specific case with your bank's authorised dealer or a FEMA-aware lawyer.

Funding the Purchase: NRE, NRO and FCNR Accounts

All payments must travel through proper banking channels. You cannot pay in foreign currency cash or traveller's cheques. Use one of:

A practical tip: if you intend to take money back out later, fund as much of the purchase as possible from your NRE account or via inward remittance, and keep clean records. The funding trail you create today decides how smoothly you can repatriate sale proceeds tomorrow. Browse verified, NRI-ready listings and area insights on our NRI services hub before you commit.

NRI Home Loans in India

You do not need to bring the full corpus from abroad. Indian banks and housing finance companies offer NRI home loans, typically:

Loan-to-value: up to about 75%–80% of property value (as of 2026 — varies by lender and profile)
Repayment: through NRE/NRO accounts or direct inward remittance
Tenure: often shorter than resident loans, commonly 15–20 years

Interest rates float with the RBI repo rate and lender spreads, so treat any quoted rate as indicative and confirm the current rate at the time you borrow. Keep your KYC, overseas income proof and a valid Power of Attorney ready — lenders ask for all three.

Power of Attorney (POA): Buying Without Flying Down

Most NRIs cannot attend every registration appointment in person. A Power of Attorney lets a trusted person in India act on your behalf — signing the sale deed, registering, and dealing with the builder or society.

Get it right:

1. Draft a specific POA (not a vague general one) naming the exact powers and the property. 2. Execute and attest it at the Indian Embassy/consulate in your country of residence, or before a notary and then apostille, depending on the country. 3. Adjudicate and stamp it in India within the required window (commonly three months of receipt) and pay the applicable stamp duty in the relevant state.

Prefer giving POA to a close family member rather than an agent, and keep the powers narrow. A loose POA is a common route to property fraud.

Stamp Duty, Registration and GST

These are the same for NRIs as for residents, and they are state-specific:

Stamp duty: broadly in the 5%–8% range across most states as of 2026, with some states offering rebates. Confirm the current rate with the state sub-registrar or your lawyer — it changes often.
Registration charges: typically around 1% of value.
GST: applies to under-construction property (commonly 1% for affordable and 5% for other residential, without input tax credit, as of 2026 — verify the current GST rate). Ready-to-move property with a completion certificate attracts no GST.

Always insist on a RERA-registered project. Under RERA, 2016, you can verify the project and promoter on your state RERA portal — non-negotiable for an NRI buying remotely.

Repatriation: Taking Your Money Back Out

This is where planning pays off. Under FEMA:

Sale proceeds of up to two residential properties can be repatriated.
Repatriation of current-account funds is capped at USD 1 million per financial year per the LRS/repatriation framework (as of 2026 — confirm the current limit with your authorised dealer bank).
Repatriation is smoother where the purchase was funded through NRE/inward remittance and where taxes are paid and documented.

You will typically need Form 15CA/15CB (the latter certified by a CA) to remit proceeds abroad. Build this paperwork into your timeline, not as an afterthought.

TDS and Capital Gains for NRI Sellers

Tax is the step most NRIs underestimate. When an NRI sells, the buyer must deduct TDS at source:

Long-term gains (property held over 24 months) attract a base rate of around 12.5%, plus surcharge and cess — pushing the effective rate to roughly 13%–15% depending on the gain amount (as of 2026 — confirm the current rate with your CA).
Short-term gains are taxed at your applicable slab rate.

The buyer needs a TAN and must file Form 27Q. To avoid TDS being deducted on the full sale value rather than just the gain, apply to the Income-tax Department for a lower/nil deduction certificate under Section 197 well in advance.

You can also reduce capital gains tax by reinvesting under Section 54 (into another residential property) or Section 54EC (into specified bonds, currently capped around INR 50 lakh per the Income-tax Act as of 2026 — verify the current limit). These reliefs need precise timing, so loop in a CA before you sign.

Frequently Asked Questions

Can an NRI buy any property in India?

An NRI or OCI can freely buy residential and commercial property in India. Agricultural land, plantations and farmhouses are not permitted without specific RBI approval, even where inheritance routes apply with conditions.

How much money can an NRI repatriate after selling property in India?

Under FEMA, sale proceeds of up to two residential properties can be repatriated, and current-account remittances are capped at USD 1 million per financial year per the LRS/repatriation rules as of 2026. Confirm the current limit with your bank's authorised dealer.

What TDS applies when an NRI sells property in India?

The buyer must deduct TDS on the sale consideration — long-term capital gains attract a base rate plus surcharge and cess (around 13%–15% effective as of 2026, varying with gain quantum). The buyer needs TAN and files Form 27Q. Confirm the current rate with a CA.

Does an NRI need to be present in India to buy property?

No. An NRI can complete the purchase through a registered Power of Attorney given to a trusted person in India, executed and attested at the Indian Embassy or consulate abroad and adjudicated in India.

Can an NRI take a home loan in India?

Yes. Most Indian banks and HFCs offer NRI home loans of up to 75%–80% of property value, repayable via NRE/NRO accounts or inward remittance. Eligibility depends on income, country of residence and KYC.

Which bank account should an NRI use to buy property?

Use an NRE, NRO or FCNR account. NRE-funded purchases ease later repatriation; payment must be routed through banking channels — never in foreign currency cash or traveller's cheques.

Ready to Buy From Abroad?

UrbanYardz makes NRI buying property in India simpler — RERA-verified listings, remote-friendly documentation, and guidance on FEMA, POA and repatriation. Start with our dedicated NRI services and let our AI search find the right home, in the right city, with the paperwork done right.