You can own as many properties as you want.
There are a few exemptions available for long term Capital Gains, if you:
If the house is held for less than three years prior to its sale, it is termed as a short-term capital asset and any gain arising from the sale is treated as a short-term Capital Gain. There are no tax exemptions for short-term Capital Gains and one needs to pay it according to the applicable tax slab.
However, if the property is sold after holding it for more than three years, it is treated as a long-term capital asset and the gain arising from it is called the long-term Capital Gain. Such gains attract a flat exemption rate of 20%.
Property is considered a capital asset and Capital Gains Tax is levied on the gains arising from the sale of property. Such gains are calculated after adjusting the inflation rate, transfer and renovation charges.
Yes. Generally, the stamp duty on the gift deed ranges from 5% to 12% in all states. In few states like Haryana, Rajasthan and Delhi, concession of 1 to 2 per cent is given to female transferors.
Stamp Duty is the tax paid for the legal recognition of property. It is paid by the home buyers. You can claim tax incentives of up to Rs 1.5 lakh on stamp duty and registration charges on a new property purchase or construction of a house. However, these benefits are available for only one self-occupied property.
TDS– 1% on immovable properties (except agricultural land) exceeding Rs 50 lakhs.
Stamp Duty – Depending upon state and municipal laws
Service Tax- It is a central tax paid for the services offered by the developer to you. From April 1, 2015 onwards, if the apartment is worth less than Rs 1 crore, or has a floor area less than 2000 sq ft, the service charge levied is 14% on car parking and preferential location charges (PLC) and 3.50% on the basic sale price. If the apartment is worth over Rs 1 crore, or has a floor area greater than 2000 sq ft, the service tax levied is 14% on car parking and preferential location charges (PLC) and 4.2% on the basic sale price of the flat.
The buyer needs to pay the following taxes:
The property could be converted from leasehold to freehold if the local laws allow it. For example, properties under DDA can be converted to freehold by executing a Conveyance Deed but the same is not allowed if the property is owned by the Noida Authority.
The difference between a leasehold property and a freehold property lies in its ownership . In a leasehold property, the ownership remains with the concerned local authority or the government (as the case may be). The lease period varies typically between 30 to 99 years. But, this does not prevent the individual owner from selling or perform other transactions with the property, provided the lease deed is registered.
In case of a freehold property, the owner of the property is the legal owner and can sell/lease/rent the property as per his/her wish .
The language of the registration document must be the one that is commonly used in your district. According to Section 19 of the Indian Registration Act, the Registering Officer or the registrar has the power to decline registration of your document if it is presented in a language which is not commonly used in the district unless it is accompanied with a true translation of the language in use.
Power of Attorney allows a person to authorize another person the right to make decisions regarding the person’s assets, finances and real estate properties.
There are two types of power of attorney. First, the ‘General Power of Attorney’ where a property owner confers ‘general’ rights. The rights include but are not limited to sell, lease, sub-lease etc. The second one is the ‘Special Power of Attorney’ where only a specific right is given by the owner to the chosen person.
Registration of a property includes necessary stamping and paying of registration charges for a sale deed and getting it recorded at the sub-registrar’s office of the concerned jurisdictional area. If a property is purchased from a developer directly, getting it registered amounts to act of legal conveyance. In case the purchased property is a second or third transaction, it involves a duly stamped and registered transfer deed. Nowadays, property registration process is computerized in most states.
It refers to the registering of documents relating to transfer, sale, lease or any other form of disposal of an immovable property. Registration is compulsory by law for all properties under Section 17 of Indian Registrations Act, 1908. Once a property is registered lawfully, it means that the person in whose favor the property is registered, is the lawful owner of the premises and is fully responsible for it in all respects.
Clear and marketable Title, Sale Deed, Encumbrance Certificate, latest tax receipts, Occupancy Certificate, Building Plan Approvals and Possession Certificate.
New Sale Deed, PAN Card, Photographs.
Sale Deed, No Objection Certificate (NOC) from builder, NOC from banks, Building Plan approvals, Completion Certificate, PAN Card and Photographs.
Allotment papers of the plot, Building Plan approvals, Transfer Deed (in case of multiple owners), Sale Deed, PAN Card and Photographs.
Yes. FIR is compulsory in cases where insurance is claimed for malicious damages, riots, terrorism, burglary, theft and larceny. In case of a fire incident, you need to submit the assessment report compiled by the fire department as well.
Property valuation is done by multiplying the built up area of the property with the cost of construction per square feet. This is the usual method followed by most banks.
It varies from bank to bank. Generally, most policies cover a period of five years.
Under personal possessions, home insurance companies generally cover furniture, electronic/electrical gadgets and jewelry under personal possessions. However, the maximum liability of these items depends upon the type of insurance cover sought or valuations done by the bank.
Home insurance policies cover the house structure as well as its contents or possessions. Many insurance policies also combine various personal insurance features too.
Home insurance is a type of insurance policy that covers private residences and protects them from unpredictable damages, natural or man-made disasters, burglary and theft.
Yes, lending institutions allow you to prepay your loan. However, these institutions may charge early repayment penalties, which may vary from 2 to 3% of the outstanding principal amount.
It depends from one bank to another. Some banks ask for 1-2 guarantors
It is generally advantageous to go for a home loan as it helps you in availing tax benefits. However, please consult your CA or tax advisor to discuss the advantages and disadvantages in your case.
In a majority of the cases, the property to be purchased itself becomes the security and is mortgaged to the lender till the entire loan is repaid. A number of lenders may ask for additional security such as life insurance policies, Fixed Deposit receipts and savings certificates.
Yes, you can sell the property with the consent of the banking institution.
If the buyer wants to take a loan to buy the property, the process is much easier if he approaches the same bank. In these cases, the bank does not need to release the property papers to another bank before getting the payment.
If the buyer wants to make a payment outright, he can make it to the bank directly. The property papers will be released only after the bank has recovered the entire loan amount.
Yes, a single woman can get a loan. Many lending institutions also have special schemes for them, such as a discount of up to 0.25% on the interest rate.
Generally, banking finance institutions pay around 75 to 85 percent of the cost of the property bought. The remaining 20 % of the amount is paid up front, which is popularly known as the down payment.
On an average, loans are disbursed within 3-15 days after satisfactory and complete documentation and completion of required procedures.
Yes, you can get the benefit on both loans. However, the total amount that you will be entitled to will not exceed Rs 1,50,000 for both the homes.
As per Section 80C of the Income Tax Act, you are allowed separate deductions on principal and interest amount of home loan amount, along with other entities like ULIP, PF, PPF, ELSS and NSC’s. In case of principal, you can claim deduction up to Rs 1.5 lakhs while in case of interest, it is Rs 2 lakhs. The amount of stamp duty and registration is also eligible for tax deduction.
It is important to note that the tax break can only be claimed for the year in which the construction is completed.
Home loans are usually accompanied by the following extra costs:
In fixed interest rate, the interest remains constant throughout the loan period irrespective of the changes in market conditions while in the floating interest rate, the interest can decrease or increase depending on market fluctuations .
The interest on home loans is usually calculated either on monthly reducing or yearly reducing balance. In some cases, daily reducing method is also adopted.
You have to submit the following documents:
Apart from other criteria and norms of the lending bank, the home loan amount is generally calculated as 30 to 65 percent of your gross income. You can increase your loan amount by including a co-applicant.
The general eligibility conditions are as follows:
Yes. One can avail a pre-approved loan from a housing financial institution or a bank.
Under the Pre-EMI option, the borrower is required to pay only the interest on the loan amount that will be disbursed as per the progress on construction of the project. The actual EMI payment starts after the possession of the house.
EMI or Equated Monthly Installment is a fixed amount paid by you to the bank on a specific date every month. The EMIs are fixed when you borrow money from the bank as a loan. EMI’s are used to pay both interest and principal amount of a loan in a way that over a specific number of years, the loan amount is repaid to the bank with interest.
Longer the tenure you have, the lesser will be your EMI but higher would be the interest outgo. In shorter tenures, you pay a greater EMI, but the loan gets repaid faster and you pay less interest.
As home loans cover a large sum, the tenure generally varies between 3 to 30 years.
The banks usually offer these nine types of loans on interest:
Home loan is the money borrowed from a bank or a housing finance institution on interest for buying / constructing / upgrading a residential real estate property.
A buyer could ask you for the original Sale Deed, Title Deed, relevant tax receipts and Encumbrance Certificate.
Only the buyer pays the Stamp Duty.
Yes. But the procedure and forms may vary from state to state depending on the location of the property. Every state in India has formulated its own set of forms under the registration rules. These forms are to be filled up and filed at the time of the registration of Sale Deed/Transfer Deed.
Under the Income Tax Act and rules for a sale transaction, it is mandatory for the buyer and seller to provide their PAN card number and in the event of sale, either the seller and/or the buyer would need to fill up Form 60 of the Income Tax.
If the buyer or the seller is a Non-Resident Indian (NRI) not assessed for t axes in India, the person would not need to file Form 60 of the Income Tax.
Yes. You can get it done at the sub-registrar’s office of the concerned district.
The sale of a residential property is said to have been formalized if the seller has received the entire consideration amount, registration of the documents has been carried out and actual possession of the property has been granted to the buyer.
No tax benefits are available for NRI’s unless you file your returns and subsequently become eligible to avail the tax benefits.
Apart from the documents mentioned under the home loan section for Indian citizens, NRIs are required to submit a few additional documents as well. These include:
The housing loan needs to be paid upfront for the entire tenure of the loan by way of direct remittances from abroad through normal banking channels or from other financial accounts as may be permitted by RBI. Generally, payments are done through NRO, NRE, NRNR and FCNR accounts. These accounts change on the basis of RBI regulations.
Home loan offered to NRIs do not exceed 5 years in major cases. However, some financial institutions offer loans for a term of 7 years as well. The repayment for the loan is done through monthly installments (EMI), which usually begin after the entire loan is disbursed. Cases which involve part disbursement, you need to pay simple interest at the interest rate applicable on the amount disbursed.
The eligibility is calculated in the same way as it is done for resident Indians with special emphasis on:
To purchase a house which is either ready to move in, under construction or bought from another owner, an NRI is eligible to apply for home loans. Additionally, NRIs can apply for home loans –
In case of residential properties, the repatriation of sale proceeds is restricted to not more than two such properties, if the property was purchased from funds held in an NRE Account.
Additionally, the amount repatriated out of India should not exceed the amount paid for acquisition of the immovable property in the foreign exchange received through normal banking channels or from the funds held in FCNR or NRE Account.
Yes, the RBI has granted general permission for sale of property. However, where another foreign citizen of Indian origin purchases the property, funds towards the purchase consideration should either be remitted to India or paid out of balances in non-resident accounts maintained with banks in India.
Under the general permissions available, an NRI/PIO may purchase residential/commercial property in India out of funds remitted to India through normal banking channels or through funds held in his NRE/FCNR (B)/NRO account. No consideration will be paid outside of India.
With specific approval from the RBI , a resident outside India may hold an immovable property in India acquired through inheritance from a person resident outside India, provided the owner had acquired such property in accordance with the regulations of the foreign exchange law in force at the time of acquisition or should be under FEMA guidelines.
Yes. A person resident outside India can hold immovable property acquired by way of inheritance from a person resident in India as per the provisions of Section 6(5) of the Foreign Exchange Management Act, 1999.
Yes. Under the general RBI guidelines, NRI/PIO may acquire residential/commercial property by way of gift from a person resident in India or an NRI or a PIO.
Yes. A Foreign National of non-Indian origin including a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan can acquire residential properties on lease in India. If the lease does not exceed five years, he/she does not require any prior permission from the RBI.
Yes.
No, an NRI or a PIO cannot buy a property in India jointly with a foreign citizen.
No. A person resident outside India cannot acquire by way of purchase agricultural land/plantation property/farm house in India.
No. There is no limit placed on the number of residential properties an NRI can buy in India.
No, NRIs don’t require consent from the RBI to buy an immovable property in India, provided the property is residential or commercial in nature.
As per India’s Foreign Exchange Management Act (FEMA) 1999, a person resident in India is a person residing in India for more than 182 days during the course of the previous financial year (April-March) and who has come to or stays in India either for employment, business or for any other vocation.
PIO means an individual (not a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan), who at any time held an Indian passport, or who or either of his parents or grandparents were a citizen of India according to the Indian Constitution or the Citizenship Act, 1955.
As per India’s Foreign Exchange Management Act (FEMA) 1999, an NRI or Non Resident Indian is a citizen of India or a foreign national of Indian origin living outside India for the purpose of employment, business or any other vocation, which would indicate his intention to stay outside India for an indefinite period of time. An Indian would also be termed as an NRI if his stay in India is less than 182 days.
Vastu might be an ancient science, offering insights into building construction, but it is as popular today as it ever was. To provide better clarity to buyers who seek to build Vastu-compliant homes, we answer some frequently asked questions about property building, keeping in mind the rules prescribed in Vastu Shastra.
Are a household’s peace and well-being connected with its Vastu?
Houses that are designed to provide smooth coordination between the five elements of nature: earth, air, water, fire and space, are likely to attract peace. By laying down specific rules, the ancient Indian science of Vastu ensures the same. Since healthy living has a lot to do with a healthy life and a growing career, a home that is blessed with easy access to all the natural elements, is likely to promote an overall healthy and prosperous life cycle.
How does the shape of a plot impact a home’s environment according to Vastu?
Vastu lays a great deal of emphasis on shapes and sizes in building construction. While some shapes are considered perfect for living purposes, others are not highly recommended. The premise of this is also based on the logic that a house should be shaped and be facing the natural elements in such a way that it gets the best of everything, without having too much exposure that would be detrimental for human life in any way.
For residences, square or rectangular-shaped plots are ideal. Round, oval, triangular and L-shaped plots are best avoided. Vastu recommends against flats/plots what have cuts towards the corner.
Does a person’s date of birth influence property purchase?
Vastu does not specify any such rule. It holds true, only when it is interpreted keeping in mind the rules prescribed under astrology. This concept has its source in numerology, too.
If a home is not built following Vastu rules, will it have a negative impact during resale?
Buyers are becoming increasingly conscious about Vastu Shastra and its impact on their life. Consequently, builders now use Vastu-compliance as a unique selling point for their housing projects. A Vastu-compliant house will surely help, if you are planning to sell it.
What should be the location of water tanks/septic tanks in a house as per Vastu?
The ideal locations to place overhead water tanks are in the north, west and north-west directions. It must be ensured that the overhead tank is not placed right above the main entrance. Barring the west, a septic tank could be placed in any direction. However, it should not have an extension in the south or the south-west.
What should be a house’s floor plan according to Vastu?
North-facing homes are considered the ideal floor plan according to Vastu.
What are the remedies if a house has Vastu doshas?
Vastu offers problem-specific remedies, in order to lessen the impact of what are known as doshas (deficiencies). By making small changes in your household, it is possible to address a specific shortcoming that your house might have from a Vastu point of view.
What is the significance of open spaces in Vastu?
To maintain balance between the elements, open spaces are highly recommended in Vastu. It also recommends keeping the open spaces towards the north and east.
Is it necessary to construct a house in accordance with the principles of Vastu Shastra? If one doesn’t follow them, can it cause problems?
More than often, buyers do not have a choice to check and ensure that a property is built in a Vastu-friendly manner. At the same time, there are no definite facts to indicate that living in a house that is not built keeping in mind the Vastu rules, can be disastrous.
However, it must be noted here that Vastu is more of a science, in which rules are made keeping in mind the environment we live in. It is, for example, scientifically good to have as much sunlight and natural light in your home as possible, something that Vastu strongly prescribes.
Are Vastu compliant properties costlier?
Since a lot of planning, diligent execution and resources go into a Vastu-compliant home, such properties are typically priced much higher than similar properties that are not constructed in accordance with Vastu rules.
The increased demand for such homes is another reason why Vastu-compliant homes are costlier. Such is the popularity of this ancient concept now that second-time buyers often look for new properties so that they are able to move to a home that meets Vastu standards.
When compared to a normal property, rates of Vastu-complaint properties may be higher by 4%-10% per sq ft.
Many potential homebuyers face the challenge of not having ample funds to buy a property of their choice. While a majority are dependent on loans, it is not necessary that a homebuyer would be sanctioned a loan amount of their choice. Hence, homebuyers are suggested to get a pre-approved home loan.
However, at times, pre-approved and pre-qualified, are two such terms that are confusing for many.
Here’s a lowdown on how the two are different:
What’s pre-qualified?
Being pre-qualified for a home loan is one of the initial steps a homebuyer takes. In this process, the homebuyer is to provide all the details that show they are qualified to get a home loan of a certain amount. Here, a homebuyer has to provide their financial status, including income, debt and assets. Based on this information, the banks inform you about the amount of loan you are qualified to get. In case you want to know your qualification, you could visit the bank’s website or the bank branch near you. For this the bank doesn’t generally charge anything neither requires your credit report. It only needs a conversation between you and the bank representative where you could share your home-buying goal and they could suggest you the amount and type of loan that would suit you.
However, be sure that the amount discussed may not be what you might be approved for. This is just the beginning of whether or not you qualify for a home loan. So, being pre-qualified is not of the same weight as pre-approved.
What is pre-approved?
Pre-approved loans are completely different from being pre-qualified. It is the next step you take after you have pre-qualified. During the pre-approved process, you officially apply for a loan through an application, pay for the application, submit all the required documents that show your financial standing and also your credit rating.
During this process, the lender could tell you the amount of loan you could get and the interest rate. In some situations, the lender can also lock the specific interest rate.
The loan amount suggested by lender could help you look for a property that fits your budget for both down payment as well as home loan.
The advantage of getting both allows you to be prepared even before you start looking for a property. You would know what kind of property you could afford, limiting your options. Also, when making an offer, you would be at an advantage when compared to other potential buyers if you are pre-qualified and pre-approved.
This website uses cookies.