Real Estate Rules Around The World India Can Take A Cue From

Believe it or not, easy real estate laws give a leg-up to the property market as buyers invest their hard-earned money without any hesitation. While India is still struggling to bring Indian real estate under the purview of strict accountability, transparency and timelines, there are a few lessons that India can learn from other countries.

Prevalent rules for domestic buyers

Higher tax on selling home that is not a full-time residence: Britain

Initially applied only to local residents, Britain brought this rule for property investors where sellers have to pay capital gains tax which may go up to 28 per cent for selling property which is unoccupied. Higher stamp duty on land transfer is another way to curb the demand for land – the rule was recently unveiled by the lawmakers of the country.

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Extra taxes on buyer who sell in less than four years: Singapore

Buyers and investors who sell their property in less than four years have to pay extra taxes and have to pay more fees for buying a second home. For foreign investors, there is an extra tax of 15 per cent applicable on the purchase of a home.

Only 20 per cent of the housing stock is liable to be used as second home: Switzerland

It is only three years that Switzerland has put restrictions on housing stocks and a number of houses an individual can buy. Investors from outside the Europe can buy an only finite number of homes in the state.

Real Estate Advertisements to be pre-approved: Dubai

Dubai has made it compulsory for all real estate companies to get their advertisement pre-approved from Real Estate Regulatory Agency. In fact, companies need to get a permit to announce print and radio ads or digital ads before floating it on the social media.

Also Read: Dubai Airport: A Perfect Example Of How 'Outsiders' Drive Growth

Limiting the availability of land in big cities: China

To avoid crowding big metro cities, Chinese civic bodies have put restrictions on land supply in big cities. Moreover, tighter funding channels and restricted credit supply are the other ways of limiting the purchase of land in a big town.

Stringent rules for foreign investment in real estate

Since India does not allow foreign investment in residential housing, the cabinet has recently approved 10-year PR for foreign nationals and right to own a house only if the investor puts Rs 10 crore in business opportunities and employs 20 Indians in a particular financial year. However, the relaxation of rules for foreign investment can be made to make Indian real estate popular as an asset class. 

Full documentation and declaration of remittances of funds by foreign buyers: South Africa

South African real estate is one of those real estate markets which is moderately popular as an investment haven but have strict anti-money laundering rules. This includes complete documentation and declaration of funds by the investors and earmarking the properties as 'non-resident'.

Restricted areas for foreign investment: Mexico, Hong Kong

Countries such as Hong Kong and Mexico where real estate investment from foreign investors are welcomed have restricted neighbourhoods, only for locals. These are usually close to border areas, immediate proximity to Central Business District and a few other VIP areas.

Indian real estate market gives a stiff competition to other global markets, owing to a stable economy, unending demand and comparable value for money properties. However, with progressive rules and regulations, it can certainly rise to the top.