Whiteser

Just paid Stg500 deposit for Colonia de Braganza, Calungute for apartment to Churchill properties. Now reading about all kinds of potential difficulties re ownership. Can anyone tell me what is the situation regarding buying a property in Goa. Churchills are not responding to email queries re law even though I have paid them a deposit on telephone. Can I form a company to make the purchase secure? We only wish to initially holiday there x 3 weeks a year. Maybe in 5 years, we may live their x 3 month a year. No rentals intended.

Any suggestions as to what I should do? Dont wish to waste hard saved money. Help......Help......Help.....

Indo Brit

Hi I take it your buying as a foreign national?

I have just paid a deposit to Churchill also for another project. I did have a look at the one you have just gone for in detail and decided it was not for me as I need something which was not on a resort as I plan to stay there for a while and need something more residential.

I found Churchill very helpful, I also spoke with their agent in Goa and Braganza pvt, gave me a good feel on doing a deal.

I understand that Braganza can draw up lease papers for you it stays in their name but you have it close to 5yrs or so then you will have to do your stay of 180 odd days to get resi rights to have freehold prop in your name. This is the way Acron and a few other builders work. With what's going on I would not set up a company this area is being looked into. There has been a fair bit written up in the posts on here so happy reading.

Have you been to Calungute before?

hope that helps.

M

Whiteser

Many thanks Indo Brit. No, have never been there but my sister in laws x 2 have bought there last year. One in 'something World???' and the other in colonia de braganza. They have been out there already holidaying and furnishing and seem very happy with their investments. One of them has a Goan lawyer and is conducting some business through him.

I rushed the deposit because, my inlaws learned about this cancellation property on phase 4 and it was necessary to rush to secure it. Now, I am worried because normally, I dont rush into anything (specially without my own lawyer) and have already a property in Spain for which I have all the necessary papers. I have knowledge of many other people who have bought properties in Spain without using their own lawyers and are now in big trouble with taxes and in some cases, even their title through fraudelent planning permission. Usually, governments have no sympathy for foreigners who dont do their homework!!

Anyway, should I hire a lawyer here or over there?? Effectively, are you saying that I only have the lease of the property until I can live their for the necessary residency period? Who owns the property until then? I have been told that I must pay Churchill the 2nd payment of approx Euro14,000 and the final payment to the developer in Goa (unknown to me as yet) on completion of the construction. Is this similar for you?

I will read as much of the forum as I can and thank you for any further info you can give me
Anne

Whiteser

By the way, do you know what is the situation regarding selling on a property for which you only have a 5 year lease? Can this be done by non-residents ?

catpat123

There is a very long thread in the Goa forum of Indiamike.com which is worth reading. It is illegal for foreign nationals to own property in India unless they satisfy the residency requirement of 183 days in a financial year (a tourist visa lasts for 180 days). It is also illegal to buy property on a tourist visa. The big developers "sell" their property on 5 year leases so the buyers won't get title to the property until they can obtain residency which I think is what most of them intend to do eventually. I would imagine that reselling without clear title would be very tricky.

Some people do seem to be setting up companies in order to buy but this is now being investigated by the authorities so best not to go down this route.

We are buying in Candolim but as my husband is of Indian origin we have PIO status (Person of Indian Origin) and have similar ownership rights to Indian nationals. We have British passports. However, if our application for PIO cards had been declined we would not be buying, it's too risky.

Indo Brit

Hi Give me a email then I can give you a number to call for a chat on this it would be easier.. you need to make a call on this before giving CIS any more funds.

my email is [email protected]

Maybe speak soon.

rgds

M

ash42

hi all, i have paid a deposit for a off plan property in braganza world siolim Goa , through Churchill innovative solutions, has anybody delt with `this company .wonder if any body could give further advice like what to look out for. thanks

Indo Brit

Hi ash42,

I have done the same, dont worry you will live

your my 2nd neighbour that I have made contact with now, I will soon start a post for Braganza World so all that have booked can update, share info etc.

what did you go for ? block etc?

Are you based in the Uk? where?

Let me know you can email me direct [email protected]

Cheers

M

avocadogreen

No, you can’t simply “form a company to make the purchase secure.” It’s not that easy, in spite of what some unscrupulous or uninformed (possibly willfully uninformed) developers may tell you. In order for a company to be able to own property legally, it has to be a real, trading company and the acquired property has to be necessary for or incidental to carrying on the company’s real business. It can’t just be a shell set up for the sole purpose acquiring residential property. The formation of a “company” simply to facilitate the acquisition of a residential property is a sham transaction, and such pseudo-“companies” are coming under increasing scrutiny by Indian regulators.

As catpat123 noted above, there is a very extensive and informative discussion of the subject of foreigners buying (or attempting to buy) real property in Goa on the India website www.indiamike.com. I strongly encourage anyone who is not an Indian citizen or a PIO (“Person of Indian Origin”) and who is thinking of buying (or who thinks he or she is buying) real property in Goa or elsewhere in India to read through this entire two-part discussion. The first part of the discussion is here: http://www.indiamike.com/india/showthread.php?t=23522 (and there are over 700 entries), and the discussion is continued here: http://www.indiamike.com/india/showthread.php?t=27702 (with over 200 additional entries).

The purchase of real property by foreign nationals is highly regulated by Indian law. The provisions of the Foreign Exchange Management Act (“FEMA”) and regulations issued by the Reserve Bank of India (“RBI”) must be complied with, and increasingly, both the central government and the state governments -- notably in Goa -- are starting to apply those laws more rigorously, after having been sloppy or looked the other way for quite a while. You cannot legally buy (as distinct from lease) real property in India if you are not an India citizen or a PIO and you have only a tourist visa. Many people think they can legally buy if they become “residents” of India by “doing their 182 days” in the country in one fiscal year, but this is a misconception. First, you can’t stay in India for more than 180 days at a time on a tourist visa, and second, even if you could get a second tourist visa and immediately return to India so that you could be in the country for 182+ days within one fiscal year, that doesn’t make you a “resident” of India for immigration purposes – i.e., it doesn’t change your visa status. The whole “182 days/residency” thing is actually a taxation rule that’s part of international taxation treaties; it’s not an immigration rule, and being a “resident” for purposes of determining where you have to pay taxes does not confer a particular immigration status on you, that would allow you to legally buy real property in India. Under the FEMA, a person “resident in India” means not only a person residing in India for more than 182 days during the course of the preceding financial year but also one who has come to or stays in India either for taking up employment (which you can’t do on a tourist visa), or for carrying on business or vocation in India (which you can’t do on a tourist visa), or for some purpose that would indicate his or her intention to stay in India for an uncertain period (which is also not indicated by having a tourist visa, since there is a maximum allowable stay imposed by such a visa). In other words, to be treated as “a person resident in India” under FEMA, one must not only satisfy the condition of the period of stay (more than 182 days during the course of the preceding financial year) but must also satisfy the condition of purpose/ intention of stay. If you can’t qualify for a some category of visa other than “tourist visa” (for example, an employment visa, or an immigrant visa), you aren’t going to be able to meet the criteria for being a “resident of India,” and just harboring a desire to stay in India long-term won’t cut it. And don’t get hung up on the “tourist” terminology or waste your breath saying, “but I’m not a ‘tourist,’ I want to retire there,” because as far as the India government is concerned, you’re just a “visitor” (which is the terminology used by the UK and the U.S. for their equivalents to the Indian “tourist visa”).

It’s distressing to see so many people getting caught up in these property acquisitions that may well turn their “dream of retiring to Goa” into a nightmare!

A couple more useful links on the subject:

http://www.rbi.org.in/scripts/FAQView.aspx?Id=33#1

http://www.rbi.org.in/scripts/FAQForex.aspx

malcolmgrundy

well done advocadogreen nice to see someone giving real advice. We moved to goa (calangute) last october and intended to apply for residency next financial year but now realise the goalposts have been moved. To even be able to apply for residency you have to register within 14 days of entering india with the police when you go there with your visa you are told that you cant register unless you are staying over 180 days you cannot at the moment get a tourist visa over 180 days so there is no way of obtaining residency which means you cannot buy property legally in india. We still have our dream and are now renting and leaving india every 6 months to renew our visa but this could be refused at any time so just keeping our fingers crossed. We have heard of several people who have bought in goa who have recieved letters from the government calling them in for an interview as to how they purchased there property. Please please keep your money safe you cannot legally buy in goa a residential property with a tourist visa whatever anyone tells you we have done our homework and i wish it was ok as we would love to buy.

Douglas M

Hi Malcolm,

Nice to hear from someone who has done some homework on the ground and taken some advice, even if your Goa dream is now a bit tarnished.( I presume your are a Brit and your not of Indian origin.) You could have also gone the text book route to do your homework.

If you study FEMA you will see that foreign nationals never could buy immovable property in India on a tourist visa, they cant now and probably never will be able to.

The FEMA general permission conditions that enables a foreign national to buy without RBI permission has three main requirements, the first is inward remittance of the purchase monies through the Indian banking system.
The second is residency which is defined as physical presence in India during the previous tax year for 182 days or more AND thirdly, the intention to stay for an undetermined period of time. The conditions for time stayed and the intention are contempraneous

It is therefore the AND bit that is important , if you intend to stay for an undetermined period of time, you must logically have a visa that allows you to stay for an undetermined period. A tourist visa is for a determined period , currently 180 days , maybe reduced to 90 days later on ? and therefore cant deliver the intention to stay condition.You will find the relevant clauses in FEMA at 2(ZE) and 2(v)(i) B

As importantly ,FEMA refes to tranferring immovable property ,( that includes buying , selling and gifting). So even if you had managed to buy property as a foreign national and the authorities dont now renew your x, business, employment etc visa n, you cannot now sell the property under the general permission, because you also cant fufill the contempraneous residency and intention to stay conditions.

So FEMA hasnt changed,the only thing that has changed is the reluctance to issue long term or extendible visas to foreign nationals. I believe this reduction in the number of non endorsed 180 day visas is not accidental ,it is to reduce the number of foreign nationals able to comply with the FEMA general permission conditions and this containment practice started around the middle of 2006.

For further information, the tourist visa only entitles you to be a tourist and do touristy things, not only can you not buy property as a tourist, but you cant own a motor vehicle, have an Indian driving licence, buy your bottled gas from the state distribution scheme etc. All the other things you need to do if youre living there long term.

Most Brits need a change in perception to understand what has happened, in simple terms the Indian authorities do not want large numbers of foreign nationals owning property, running businesses and living long term in their country. We simply have to remove our personal requirements and understand and accept the new situation.

Having said all that, please enjoy whats left of Goa.

Douglas M

Sorry, I forgot to include in my last post under the list of things you cant do under a tourist visa but need to do if you live there, is to open and maintain a long term bank acccount. Residency required to do and maintain.

malcolmgrundy

hi douglas

thanks for the reply although everything we planned has been turned around a bit we are still happy living here and with renting up to now we have only had minor problems. As you mentioned with the gas we bought a european style gas cooker no problem and of course no one tells you that you cannot get the gas for it. Also quite a few problems getting a landline but that is now sorted. Prices is another thing getting used to the true price of things on some items we were at first paying 5 and sometimes even 7 times the local price and we are still learning but each month we are finding out more and realising which shops have been ripping us off and dont use these anymore there loss not ours. We are finding most goans to be very friendly and honest most local shops give you the same price to all but a lot of the traders are from all over india and just come to sell in the tourist season. I'm sure we will come across more obstacles during our stay but hopefully we can sort them out. We just feel so sorry for all the brits buying here and they still are you see them in the estate agents every day and here them talking in the restuarants. When they mention how much they have paid (some £34,000 for 1 bed flat in complex) you realise they hav'nt even checked on the prices never mind the legal side you can still buy a decent 1 bed flat for £12,000. Hope this helps some people its not all honey and roses here but we still love the place and intend to stay as long as we can but we have a back up plan if we are forced to leave.

fingers crossed

malcolm and jenny

Douglas M

Hi again Malcolm and Jenny,

Thank you for your response, as you say most Brits get ripped on the daily purchases untill they become more streetwise, i know i did. Later i saw the excess prices i initialy paid as the entry fee to Goa and offset it against the overall lower cost of living versus uk.

Although we have our fair share of numb skulls, I think Brits on the whole are corteous, respectful and generous in their behaviour when in Goa. These qualities can also be our downfall as the unscrupulous and greedy can and do take advantage.

I also remember the nightmare experience of applying for a telephone connection in Goa and share your angst, if you think thats bad try registering a motor vehicle, they make DVLA look like saints.

On the people front,living in Goa for just two years was something of an emotional rollercoaster for me, i met some of the nicest people and definitely the worst so far in my life.

Moving back to Brits abroad, Im afraid i now have little sympathy with foreign nationals who think they can still buy in Goa, its almost a year now since the anti foreigner movement became active and theres lots of info out there on this site , india mike , RBI and so on. Also, if people cant tell the difference between an invalid sales deed and a five year lease there is little hope for them. If they then pay the full freehold price for a property that isnt even built yet, i can only presume they must have left their brains at home when they came on holiday.

Moving forward a few years, when its time for these numerous off plan projects to finally get built, there is going to be another layer of dissapointment as some wont even get built of course, a large percentage of the ones that do will be of substandard construction.There will even be cases where the developer may not have owned the frehold of the land they were built on or obtained the necessary permissons. Maybe you can also throw in a few innapropriate activities going on nearby, like a workshop or a slaughter house and youve got real Goa, not the artists impression or the cardboard model!

So ,youre much better off renting and rents may even get cheaper when all this excess buy to rent capacity comes on stream over the next few years.

On the bad days in Goa, just remember what its like to emerge from manchester or gatwick airport on a cold damp november night, knowing youve got to go to work tomorrow!

Once again good luck to you both.

nativegoan

I totally agree with Douglas in all his views in his previous posts .. Its not as easy as the lawyers of Goa make it seem .For those who are investing their hard earned money , please do your homework .DO NOT RELY on what the lawyers make you believe .

The law of foreign Nationals owing property in Goa is very strict .

My advice, stick to rentals or make good connections with the locals who can offer you good rates if you plan to return year after year.