For Non-Resident Indians (NRIs), investing in real estate in India isnāt just about reconnecting with their rootsāitās often a strategic financial decision. Mumbai, the countryās financial capital and one of the most dynamic property markets in Asia, continues to attract global Indian investors with its blend of commercial vitality, robust infrastructure, and long-term growth potential. However, buying property in Mumbai from abroad requires careful navigation of legal, financial, and logistical details.
Under the Foreign Exchange Management Act (FEMA), NRIs and Persons of Indian Origin (PIOs) are permitted to buy both residential and commercial properties in India. However, they are not allowed to purchase agricultural land, plantation property, or farmhouses. There are no restrictions on the number of properties NRIs can own, and they can purchase them individually or jointly with another NRI. When co-owning with a resident Indian, some specific regulatory conditions may apply, making legal advice essential.
One of the first steps in investing in Mumbai real estate is choosing the right location. The city is vast and varied, with neighborhoods catering to different budgets and purposes. South Mumbai areas such as Malabar Hill, Worli, and Altamount Road are home to premium properties, best suited for high-value investors looking for prestige and exclusivity. The western suburbs, including Bandra, Andheri, and Goregaon, have witnessed a surge in demand due to their connectivity, cosmopolitan culture, and robust rental markets. Meanwhile, eastern suburbs like Chembur and Bhandup, and extended regions like Navi Mumbai and Thane, are gaining popularity for their affordability and long-term appreciation potential.
Financing the purchase is another important consideration. NRIs can fund their investments through inward remittances or Non-Resident External (NRE), Non-Resident Ordinary (NRO), or Foreign Currency Non-Resident (FCNR) accounts. If taking a loan, most Indian banks and financial institutions offer home loans to NRIs, typically covering up to 80% of the property’s value. Repayments must be made in Indian rupees using funds from NRO/NRE/FCNR accounts.
Legal and regulatory due diligence is critical to ensure a safe and compliant investment. It is advisable to verify that the project is registered under the Real Estate Regulatory Authority (RERA), specifically MahaRERA for Maharashtra. Buyers should check whether the property has a clear title, whether all necessary approvals are in place, and whether the developer has received commencement and occupation certificates. If the buyer cannot be physically present in India, they should appoint a trusted representative via Power of Attorney (PoA) to handle the purchase and registration process.
Taxation is another essential area for NRI investors to understand. Rental income earned from the property in India is taxable, and NRIs are required to file income tax returns in India. The buyer must also be aware of the Tax Deducted at Source (TDS) obligations on rental income and capital gains at the time of selling the property. The repatriation of sale proceeds is allowed, but only if the original investment was made using funds from an NRE or FCNR account, and applicable taxes have been duly paid. Currently, NRIs are allowed to repatriate proceeds from the sale of up to two residential properties.
Managing a property remotely presents its own set of challenges. Many NRIs opt to hire property management services to handle everything from tenant sourcing and rent collection to upkeep and legal formalities. This is especially important for investors who are not frequently in India. Alternatively, purchasing a property from a reputed developer with reliable post-sale services can also ease the burden.
Investing in Mumbaiās real estate market offers promising returns, but the process must be approached with careful planning and trusted guidance. For NRIs looking to establish a stable investment back home, Mumbai presents a dynamic opportunityācombining legacy value, economic resilience, and lifestyle appeal. With clarity on regulations, financial discipline, and sound professional advice, NRIs can make smart and secure property investments in the Maximum City.
About the Author
The author is a seasoned entrepreneur and business leader known for his innovative approach in the financial services and real estate sectors. With over two decades of experience, he has successfully led multiple ventures, combining strategic insight with a strong commitment to ethical practices, sustainability, and long-term value creation.
