Frequently asked questions about buying property

Common questions from home buyers and investors, grouped by topic: home loans, property, documentation, finance and NRIs. For advice on your own situation, talk to an advisor.

Why should I register the Agreement for Sale?

Registering it at the sub-registrar's office makes the agreed price, payment plan, home size and possession date a legal record. Under RERA, a builder cannot take more than 10% of the price as an advance before the agreement for sale is signed and registered. Most banks also ask for it before releasing a home loan.

What is carpet area?

Under RERA, carpet area is the usable floor area inside your home's walls: the rooms, kitchen and bathrooms, including inner partition walls. It leaves out the outer walls, balconies and open terraces. Builders often quote super built-up area as well, which adds a share of lobbies, lifts and the clubhouse, so it is always larger than the carpet area.

How much home loan can I get?

RBI rules let banks lend up to 90% of the property value for loans up to ₹30 lakh, 80% for ₹30 to 75 lakh, and 75% above ₹75 lakh. The bank also checks that your total EMIs stay within a safe share of your monthly income.

Which documents should I check before buying a new flat?

The RERA registration, title deed, encumbrance certificate, approved building plan and commencement certificate, and the khata in Bengaluru. For a ready home, also ask for the occupancy certificate.

How can I save capital gains tax when I sell a property?

If you have held it long enough for the gain to count as long term, you can usually cut or avoid the tax by putting the gain into another residential house in India within the set time limits, or by investing it in specified government-backed bonds within six months of the sale. Limits and conditions apply, so speak to a tax advisor before you sell.

Can NRIs buy property in India?

Yes. NRIs and OCI cardholders can buy residential and commercial property without RBI permission, paying from an NRE, NRO or FCNR account or through money sent from abroad. They cannot buy agricultural land, plantations or farmhouses. A power of attorney lets a family member handle registration if you can't travel.