Interview with a Kovalam and Vizhinjam Real Estate Agent Part 1

Today, I am asking questions about purchasing land and property in Kovalam, India with real estate expert Mr Parasu from www.kovalamland.info.

Q. Can you tell me little about yourself?

A. Hi everybody, I am a real estate agent with a government sanctioned license to sell property in Kovalam, Vizhinjam and the surrounding areas. I also broker property agreements between foreign companies and Indian land owners.

Q. I will get straight to the point. Is is possible for foreign nationals to buy land in India?

A. Before I can answer, I need to tell everyone that India has different laws for different nationalities and for Indians who live abroad. However, to make it understandable I will answer your question, while dividing the different groups.

(a)National Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan can not buy property in India. Unless they are resident in India and then it would require approval by Reserve Bank and the Government of India.

(b)A foreign citizen who is not of Indian origin for example David Beckham or Beyonce cannot buy land in India unless

(i)He or she stays/lives in India for 182 days a year, but like everything in India , its not that simple. The Indian laws permit foreign nationals with valid visas to buy property, subject to rules layed down by the state governments. But, has to be recognised as a person resident in India under Fema, In theory, a person has to have all the supporting documents. However, theory is theory and India is India.

(ii)Everybody is welcome to start a business in India, if you have a business as a sole proprietorship (Only declaration of profit at the tax return is obligatory) or a joint venture purchase of property is possible. A investment of 1,000,000 INR is required.

(iii)A foreign company, which sets up a branch office or place of business in India, can acquire property necessary for carrying out its business.As long as they follow rules set down by Fema, investment, visas ect,ect.....

(iv)While it is not legal, many foreign citizens buy land as joint ventures or with surrogate partners. A foreign national can inherit or receive as a gift property in India from a person who is a resident in India. In India, money makes most things possible.

(c)Non-Resident Indian (NRI) a citizen of India resident outside India or Person of Indian Origin (PIO)- that is an individual that at any time, held a Indian passport, or whose father or grandfather was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955, can buy property.

While I have answered your questions in general terms, if anyone requires detailed explanations or advice, they can feel free to contact me at
giveandtake@kovalamland.info

Q. Thanks Parasu. How is the Indian real estate market?

A. Most of my knowledge is based in Trivandrum, Kovalam, Vizhinjam and the surrounding areas. I know that in Mumbai the prices are rising again around 3%, but its starting at a low level from the huge drop of 25% in 2009. Here in Kovalam, the prices have stabilized, apart from property on Kovalam beach which continues to rise, due to location and lack of new property. While property prices are not rising at the moment, which means its a great time to invest. This is opinion is based on the predicted continued expansion of tourism at Kovalam beach, and the huge
Vizhinjam International Container Transshipment Terminal project. In the next 10 years this area will be unrecognisable.

Q. How much does it cost to buy a three bedroom house in Kovalam?

A. It is traditional in Kovalam and infact all of Kerala for houses to stand alone in a small plot of land. Old houses depending on size are cheaper, for example a new 4 - 5 bedroom villa costs around 5,000,000 INR ( $ 101,300 USD). If a plot of 5 cents is purchased and a new house is built on it, It would cost half as much! Worth a investment?