Kerala receives one of the highest volumes of NRI remittances in India, and a large portion of that money flows into real estate. If you're an NRI — whether in the UAE, Saudi Arabia, Qatar, UK, or USA — and you're considering buying property back home in Kerala, this guide is for you.
Can NRIs Buy Property in Kerala?
Yes. Under FEMA (Foreign Exchange Management Act), NRIs can freely purchase residential and commercial property in India — including Kerala. The only restrictions are:
- ❌ Agricultural land, plantation land, and farmhouses cannot be purchased without RBI special permission
- ✅ Residential plots, apartments, villas, and houses — fully allowed
- ✅ Commercial property — fully allowed
Best Districts for NRI Property Investment in Kerala
1. Kannur — Best for Gulf NRIs Returning Home
Kannur has one of Kerala's highest concentrations of Gulf workers. The Kannur International Airport (CCJ) has direct flights to Dubai, Doha, Muscat, and Riyadh. Villas near Chirakkal and Thana are popular retirement investments. Price entry point: ₹60 lakh onwards for a good villa.
2. Ernakulam (Kochi) — Best for Capital Appreciation
Kochi is Kerala's commercial capital. Marine Drive, Kadavanthra, and Kakkanad (Infopark area) are premium investment zones. Apartment prices have appreciated 15–20% in the past 3 years. Best for NRIs who want rental income.
3. Kozhikode — Best Value for Money
Kozhikode offers Kochi-quality infrastructure at 30% lower prices. With Cyberpark expanding and the Metro proposed, early investors stand to gain well. 3 BHK apartments near Chevayur start at ₹65 lakh.
4. Thrissur — Best for Cultural and Religious Significance
Many NRIs from the Thrissur region prefer returning here for retirement. Guruvayur, Thrissur city, and Chalakudy are popular choices. Good appreciation in villa segment.
5. Thiruvananthapuram — Best for Government Employees and Techies
Kerala's capital is a stable market with demand from government employees and Technopark workers. Properties near Technopark offer consistent rental income.
Step-by-Step Process for NRI Property Purchase
- Choose the property — Visit BookPropertyVisit to browse 700+ listings across Kerala
- Verify RERA registration — Check rera.kerala.gov.in for new projects
- Appoint a Power of Attorney (POA) — If you cannot attend registration in person, execute a POA in your country of residence (must be attested by Indian Embassy/Consulate)
- Due diligence — Get an Encumbrance Certificate and verify title deed through a local lawyer
- Payment — Use NRE or NRO account. Foreign inward remittance is fully accepted. Do not pay in cash
- Registration — At the Sub-Registrar Office. Pay stamp duty (6%) + registration fee (1%)
- Mutation — Update records at Village Office and Municipality after registration
NRI Home Loans in India
Major Indian banks offer NRI home loans:
- SBI NRI Home Loan — Up to 80% of property value, competitive rates
- Federal Bank — Strong presence in Kerala, NRI-friendly processing
- South Indian Bank — Specialised NRI banking services
- HDFC / ICICI — Pan-India lenders with NRI desks
Current NRI home loan rates: 8.75–9.5% per annum. Loan tenure up to 30 years. Maximum loan amount depends on your overseas income and credit profile.
Tax Implications for NRI Property Buyers
- TDS — When buying from a resident Indian, the NRI buyer must deduct 1% TDS. When buying from another NRI seller, TDS is 20–30%
- Rental income — Taxable in India at applicable slab rates. Can be repatriated via NRO account
- Capital gains — Short-term (held <2 years): taxed as income. Long-term (held >2 years): 12.5% without indexation
- DTAA benefits — India has Double Tax Avoidance Agreements with UAE, UK, USA, and most Gulf countries
Managing Your Kerala Property from Abroad
One of the biggest concerns NRIs have is managing property from abroad. BookPropertyVisit helps:
- Free site visit scheduling — our team visits on your behalf and sends video/photos
- Builder communication handled end-to-end
- No brokerage fees — you deal directly with the builder or owner