It's surprising how much time the property buyers spend on searching for the right house or apartment. At the same time they dismiss as less much important other issues like the country's political and economic system, environment issues, general health hazards. It's surprising because the thing we can change quite easily is the property itself that we buy. We can fix the roof if it leaks, we can add a room if our family increases. What we can't do alone is to replace our neighbors, to change the social system of the country, to make the air less polluted, to reduce the level of criminality. That's why before going deeper into Indian real estate market it would be wise to look at the country from more general perspective and try to digest some information that will be needed no matter where we choose to settle down.

According to the official Indian sources, it's not allowed to foreigners to invest in fields such as retail trade, housing and real estate, agriculture and lottery and gambling. Such statement is strikingly radical because there are non-Indians who indeed own properties in the country. So here a clear distinction should be made between foreigners acting under cover of foreign companies or in person who want to buy from abroad and who aren't allowed to do so, and whose who have made their homework by acquiring residence permits for the country and who under certain conditions, e.g. Indian Central Bank permit, can buy. In the areas when the foreign investment is allowed, there are also some limits set for the different sectors.

On the one hand, many of those who have interest in buying properties in India are former Indian citizens living around the world, who have acquired different citizenship throughout the years. Until recently they were treated with no distinction to the other foreigners because India didn't allow dual citizenship until very recently. Since December 2003 the Citizenship act was amended, allowing such dual nationality. It can automatically give back Indian citizenship to any former Indian citizen and to the children of the Indian citizens living abroad, more precisely in 16 countries with large Indian immigration communities.

On the other hand, besides many wealthy and not so wealthy Indians returning to their mother country to buy, there are some real foreigners who for different reasons have decided to make more than one or two tourist trips to this ancient civilization. They are fascinated by what they have seen on the tourist postcards or by taking brief organized trips to Taj Mahal, and have already started looking for suitable housing, the only element of their adventure they could actually remake. Living up to their dreams can become a daunting task because even after acquiring Indian residence permit buying a property isn't an easy project. Indian civil service is famous for its red tape, slow movement and for some unofficial practices, better known in other countries as bribery.

To be honest, this is only the top of the iceberg of problems hunting for the small investors. More fundamental difficulties come from unclear property titles; there always will be distant relatives coming to claim ownership on your property. To cut all these problems some people prefer to buy using third local party as a legal buyer, by means of complex techniques similar to a trust. As a result the property is owned by an Indian and a foreigner, and is used by the foreigner some moths of the year and rented out by the Indian the rest of the time. This may be a dangerous enterprise because legally speaking the Indian market is still a virgin land compared to more sophisticated western practices and you can easily be fooled by more experienced local "experts". But the possibility to buy remains and if you're die-hard Indiaphile you may try your luck.

--------------------

See also the directory of companies providing real estate services in, and general real estate information of India.