slide 6-1 asia/pacific & international real estate 6. a look at india page 105
TRANSCRIPT
Slide 6-1
ASIA/PACIFIC & INTERNATIONAL REAL ESTATE
6. A Look at India
Page 105
Slide 6-2
GeographyPage 106
Slide 6-3
Modern India
Economic Growth—surpassing China?
Growing Middle Class
Homeownership—86%
Subsidies and Rising Commodity Prices
Infrastructure issues
Spreading urbanization, crowded cities
Page 107-110
Slide 6-4
Monsoon Season
Torrential downpours
80% of the annual rainfall
June to August
Beneficial monsoon season bolsters the economy
Page 109
Slide 6-5
FDI
Top FDI Investors in India1.Singapore2.Japan3.United States4.United Kingdom5.Netherlands6.Cyprus* 7.Germany8.France9.UAE*
Top Sectors for FDI20%–Services
8%–Telecommunications
7%–Computer hardware and software
7%–Construction
7%–Housing and real estate
Page 111
Slide 6-6
India Diaspora
Your Next Client?United States: 2.2 millionCanada: 1 millionU.K.: 1.5 millionS. Africa: 1.2 millionMalaysia: 2 millionSaudi Arabia: 1.7 millionUAE: 1.7 million
Page 112
Slide 6-7
NRIs and PIOs
Non-Resident Indian (NRI)
Person of Indian Origin (PIO)
Overseas Citizen of India (OCI)
Prime source of investment in real estate
Government encourages ties and long term investment
NRI Colonies--full-amenity communities
Page 112-113
Slide 6-8
Why Is This Important?
Diaspora pulls Indians abroad
Career opportunities
Family ties
Immigration
Real estate business potential
Page 113
Slide 6-9
Bank Accounts
Page 114
Determines flow of funds for real estate transactionsNon-Resident Ordinary Rupee Account (NRO)
Non-Resident External Account (NRE)
Foreign Currency Non-Resident Account
(FCNR)
Annual repatriation limit of US$1million
RBI approval for repatriation
NRIs only
Funds must be from abroad
Government approval required to withdraw funds for real estate purchase
NRIs only
Foreign currency from abroad
Slide 6-10
Buying Real Estate in India
Indian property law Maintain real property ownership by resident
citizens Quell speculation
Limit ownership to Indian citizens, those with family ties
No ownership of agricultural land, plantation property, or a farm house
Page 114
Slide 6-11
Crore and Lakh
Page 115
1 Crore = 10 Million
1 Lakh =100,000
Slide 6-12
Transaction Costs
Stamp Tax
Registration Fee
Capital gains tax
Real estate agent fees
Registration
Property tax
Page 115-116
Slide 6-13
Foreign Ownership?
May purchase a residence
Prior-year’s stay of 182 days required plus proof of intent to reside in India indefinitely
Foreign residents of Non-Indian Origin
Non-residents of non-Indian origin
No purchase allowed
May rent a residential property
Maximum 5-year lease
Page 116
Slide 6-14
Commercial Real Estate
Foreign corporations need Reserve Bank of India approval to buy or sell real property
Trend toward outlying business park development
Residential development funded with foreign capital requires25 acres of land
Commercial properties minimum 50,000m2
Page 117
Slide 6-15
Rental Property
Rent-control laws skew rental markets
Apply to leases of 12 months or more
11-month leases common
Serviced apartments provide short term housing for staff of foreign companies
Page 117
Slide 6-16
Real Estate Professionals
States regulate of real estate practiceNo licensing Informal channels-homemakers, friends and
relatives, kiosk owners, and janitors National Association of
Realtors–India striving for professionalism nationwide MLS
Page 122-128
Slide 6-17
Doing Business In India
Beyond the Basics
IntroductionsWomen in BusinessBusiness CardsConversation Starters MeetingsDemeanorContracts and
NegotiationsA Few TaboosSocial Etiquette
Page 85