Property Due Diligence Checklist
NRIs often buy properties sight-unseen. This checklist prevents costly post-purchase surprises — from society bylaws that ban Airbnb to hidden tenants with legal rights — before you commit.
What's included
- Title verification — encumbrance certificate, sale deed authenticity check
- Municipal corporation approval for residential use & multi-unit rental
- HOA/society bylaws — does the society permit Airbnb or short-term rentals?
- Existing tenant status on record (any sitting tenants with rights?)
- Property tax, municipal dues & utility arrears clearance
- Structural compliance — building permissions and occupancy certificate
- Local Airbnb restrictions — tourist zones, noise ordinances, state-level rules
- Insurance eligibility for short-term rental properties
- FEMA compliance for NRI property acquisition and future repatriation
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Frequently Asked Questions
Why do society bylaws matter for Airbnb hosting?
Many Indian housing societies explicitly ban commercial activities including short-term rentals. If the society's bylaws prohibit Airbnb hosting and you proceed, you risk complaints, fines, or denial of services (lift, parking, water). Always check the bylaws before purchasing.
What is an encumbrance certificate and why do I need it?
An encumbrance certificate (EC) is a document issued by the sub-registrar's office listing all financial and legal liabilities on a property — mortgages, liens, court orders. It confirms the seller has clear title with no hidden claims. Request an EC for at least the past 15 years.
Can NRIs freely buy property in India for Airbnb?
Yes. NRIs can purchase residential and commercial property in India under FEMA regulations (except agricultural land, farmhouses, and plantation property). However, acquisition must be through normal banking channels using NRE/NRO accounts, and rental income repatriation has specific documentation requirements.