NRI rules for buying property in India, and the title verification that comes first

Which law sets the NRI rules for buying property in India?

Section 6 of the Foreign Exchange Management Act, 1999 lets the Central Government control property dealings by people resident outside India. It does that through the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, in force since 17 October 2019. Rule 24 covers NRIs and OCIs, Rule 25 covers a foreign-citizen spouse, and Rule 31 covers citizens of certain neighbouring countries.

The 2019 Rules replaced the Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2018, which had replaced the regulations of 2000. The substance moved very little. The legal source did, so a bank form, broker's note or website that still cites the 2018 regulations is out of date, and any operational detail should be checked against the RBI's current directions.

Buying a flat, house, shop or office under these Rules needs no RBI permission and no report to the RBI afterwards. A broker who says otherwise is usually thinking of agricultural land, or of a foreign citizen who is not an OCI. Your bank runs its own KYC and purpose checks on the remittance, and that is the whole of the exchange control side.

Who counts as an NRI or OCI for buying property?

A Non-Resident Indian, for these Rules, is an Indian citizen who is resident outside India. An Overseas Citizen of India is a foreign citizen registered as an OCI cardholder under Section 7A of the Citizenship Act, 1955. PIO cards were folded into the OCI scheme in 2015, so anyone still holding one should convert it before relying on these Rules.

Residence under FEMA is not the 182-day count people know from income tax. Under Section 2(v) of FEMA, someone who leaves India to take up a job or business abroad, or for any purpose showing an intention to stay outside for an uncertain period, is resident outside India from the day they leave. Your income-tax residence is decided separately, now under the Income-tax Act, 2025. It matters for TDS and capital gains, not for what FEMA lets you buy.

If you bought while abroad and later move back, you keep the property. And if you bought before you left, Section 6(5) of FEMA lets you go on holding it as a non-resident.

Foreign-citizen spouses and restricted nationalities

A spouse who is neither an NRI nor an OCI can buy one property jointly with the NRI or OCI spouse under Rule 25. The marriage must be registered and must have lasted at least two years before the purchase, and the property cannot be agricultural land, a plantation or a farmhouse.

Under Rule 31, citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan, Hong Kong, Macau and North Korea need prior RBI permission to acquire or transfer immovable property, other than a lease of up to five years. The rule does not apply to OCI cardholders. It never touches an NRI either, because an NRI is by definition an Indian citizen.

What can an NRI or OCI buy, receive as a gift or inherit?

Rule 24 opens three routes into ownership and treats each type of property differently.

"Relative" has a narrow meaning here. The Rules borrow it from Section 2(77) of the Companies Act, 2013, which covers a spouse, parents, children and their spouses, brothers and sisters, and members of the same HUF. A flat gifted by an uncle, a cousin or a family friend falls outside it. The donor can be resident in India, an NRI or an OCI.

Inheritance is open for every type of property, provided the person you inherit from held it lawfully. Land raises the most questions, and plots, farmland and state tenancy laws are dealt with separately in our post on whether an NRI can purchase land in India.

How must an NRI pay for property in India?

The price must come through one of these routes:

• an inward remittance from abroad through normal banking channels;
• money already in your NRE or FCNR(B) account;
• money in your NRO account;
• a home loan from a bank or housing finance company in India.

Cash, traveller's cheques and foreign currency notes are not permitted. Nor is paying into the seller's bank account abroad, even when the seller is an NRI and asks for it. The Rules expect the price to be paid in India. A part-payment from a resident relative's account is not one of the listed routes either, and it confuses the payment trail you will rely on later.

Income-tax law adds its own bar: a seller may not accept Rs 20,000 or more in cash for the transfer of immovable property. So a request to pay part of the price in cash breaks two laws at once, and it is one of the clearest red flags that something else in the deal is wrong. Keep every remittance advice, inward remittance certificate and account statement. When you sell and want to take the money abroad, your bank will ask for them.

Where do NRI buyers misread the rules?

Two misreadings cost NRI buyers the most.

• "A plot next to a farm is fine if the brochure calls it residential." Only if the conversion is complete in the revenue record. Land still recorded as agricultural is barred, whatever the advertisement says.
• "The seller's lawyer has already checked the title." That lawyer acts for the seller. The due diligence that protects you is done by an advocate you appoint and pay.

How does property title verification work for an NRI buyer?

Property title verification means tracing who has owned the property, how each owner came to own it, and what claims or charges sit on it today, so you know the seller can pass a clean title. The checks are the same for an NRI as for a resident. What differs is that you cannot walk into the registry, meet the seller or look at the building, so someone you appoint has to do the work and report to you in writing.

For a flat or building in Maharashtra, a title search for an NRI property purchase usually runs like this:

1. Collect the seller's papers. The chain of agreements and deeds for at least 30 years, with the Index II for each registered document. For a flat, add the society share certificate and no objection letter; for the building, the approved plan, commencement certificate and occupancy certificate.
2. Search the registration records. A 30-year search at the Sub-Registrar's office, supported by the IGR Maharashtra online search for the years it covers, shows registered sales, mortgages, leases and releases.
3. Read the revenue and municipal records. The 7/12 extract or the property card, with its mutation entries, should carry the seller's name, and so should the property tax bill.
4. Look for charges that never reach the registry. A mortgage by deposit of title deeds is often unregistered. A search of the CERSAI register and a letter from the seller's bank close that gap.
5. Search for litigation. Case searches on the eCourts portal and the High Court, and the Debts Recovery Tribunal where the seller has business borrowings.
6. Publish a public notice. A notice in an English and a Marathi newspaper invites anyone with a claim to object, usually within 7 to 14 days.
7. Confirm who is selling. Match the seller's PAN and photo identity with the names on the title, make sure every co-owner and legal heir joins in, and verify any Power of Attorney the seller relies on with the office where it was registered.
8. Get a written title report. It should name the owner, list each document read, state every defect and say what must happen before you pay.

For a ready flat with a clean history this usually takes two to four weeks. Old buildings, inherited property and land take longer, because the records are scattered and heirs have to be traced.

Buying from a builder

For an under-construction flat, add a RERA check before buying. Open the project's MahaRERA registration on the portal itself, not a copy from the sales office, and read the title certificate, approvals and declared completion date filed there. If the builder does not own the land, read the development agreement and the power of attorney from the landowner as well.

What should the title report tell you before you pay?

A useful title report ends with conditions, not only an opinion. Typical ones are:

• a letter from the seller's bank stating the loan outstanding and confirming the deeds will be released on payment;
• a release deed from a sibling who inherited a share;
• the society's no objection to the transfer;
• a rectification deed where an older document gets the survey number or area wrong.

Those conditions go into the agreement for sale as things the seller must complete before the balance is paid. That is when an NRI buyer has the most bargaining power. It disappears once the full price has left your account. We prepare the agreement to sale with a title search report as one piece of work, from Rs 18,000.

If the report shows a Power of Attorney sale in the chain, a signature that does not match, or an owner abroad nobody has spoken to, read our note on how NRI property fraud in India usually works before going further.

What to do next if you are buying from abroad

Settle eligibility and title before any token amount. Then take the purchase in order: Power of Attorney, loan, agreement, TDS, registration and mutation. Each stage is set out in our post on the legal process for an NRI property purchase.

If the flat is occupied, find out by whom and on what paper. A licensee who has outstayed is the seller's problem before registration and yours after it, and our post on illegal possession of NRI property explains what removing one involves.

We work from Sanpada, Navi Mumbai. NRI clients instruct us by phone, WhatsApp or video call and send papers by email. For property in Mumbai, Navi Mumbai and elsewhere in Maharashtra we run the searches and registration ourselves. For other states we review the documents and explain at the first consultation how the local searches will be done. More on our NRI property legal services.