
# Hello there!  

Welcome to the PropReturns knowledge center! Investing in any asset class requires scrutiny before making a decision. The same goes for real estate investments! In a country where residential real estate is favoured by 70% of the population, only a few know that investing in commercial real estate is as easy, affordable, and profitable investment class! 

It is only necessary to possess an in-depth understanding of the same. So we created this commercial real estate knowledge center to help everyone interested in investing in commercial properties. After all, a well-researched investment goes a long way! Read, learn and understand the various aspects and investment opportunities of India’s commercial real estate sector! 


## Who we are

PropReturns is India’s top real estate marketplace. Our core value lies in providing our investors with an investment platform that makes real estate investments transparent and accessible. 

We do this by-

- Using data-driven insights for apt metrics before you invest.

- Utilising technology for a 5x faster investment process. 

- Offering expert advice based on our 50+ years of experience in the sector. 

This helps our investors make safe and calculated investments to build a long-term diversified portfolio! 


### However, we aim to do more - always!

As a real estate marketplace, we want to help you learn more about this industry! Our investors or anyone interested in investing in real estate should know the ins and out of it. We are making real estate investments transparent and understandable too! As a result, this knowledge center is designed solely to educate you about real estate investing. 




The Ultimate Guide to Buy, Sell, or Rent Commercial Properties

# REAL ESTATE INVESTMENT

Most of us Indians had dreamt of buying a property when starting off our careers. Moreover, it has stayed the same for generations; the love of Indians for real estate never went out of style. This is due to three reasons: security in investing, high potential returns, and consistent high demand 

Looking at data, according to a report by the Indian Brand Equity Foundation (IBEF), the Indian real estate market is expected to reach USD 1 trillion by 2030. The sector contributes 7% to India's GDP and is one of the largest employers in the country, with over 50 million people employed directly or indirectly. 

Further, as per the market reports, the country's commercial real estate sector is expected to reach a market size of $90 billion by 2030. It is growing at a compounded annual growth rate (CAGR) of 8 percent.
-Source: ANI News

But with great benefits, come intricacies. This section of ‘The Ultimate Guide to Buy, Sell, and Rent Commercial Real Estate’ is dedicated to making real estate investment knowledge accessible to everyone. 

For better readability, we have laid the following sections:

**1. The Basics of Property Investment**

**2. Investing in Commercial Real Estate**

**3. Preleased Commercial Property Investments**

**4. Rental Yield**

**5. REITs (Real Estate Investment Trusts**

**6. Real Estate Mutual Funds**

**7. Fractional Ownership** 

**8. Recommended Indian Cities for Property Investment**

Head to the next section to dive into real investments in detail. 


Real Estate Investment

# PROPERTY INVESTMENT BASICS

## 1. Passive Income Sources in India: Real Estate Edition

According to a survey from [Deloitte](https://www2.deloitte.com/content/dam/Deloitte/in/Documents/about-deloitte/Deloitte-Millennials-GenZ-Survey-2022-INDIA.pdf), about 62% of Indian Gen Zs and 51% of millennials have side hustles in addition to holding down a full-time job. Be it a desire to achieve financial stability, build wealth, or create more free time, the concept of passive income has captured the minds of many Indians looking to secure their future. 

One of the best ways of generating passive income is investing in real estate, and earning through licenses or royalties. 

[**Learn More**](https://www.propreturns.com/resources/blogs/active-income-and-passive-income)

## 2. How to Invest in Real Estate in India: Beginner’s Guide

Investing in real estate can be a great way to diversify your portfolio and potentially earn attractive returns. But before that you need to look at certain aspects like determining your investment goals, researching the real estate market, identifying investment opportunities, etc. 

[**Read Now**](https://www.propreturns.com/resources/blogs/real-estate-market-in-india)

## 3. Where to Invest for High Real Estate Returns in India 2023

The real estate sector has evolved and grown over the years. Traditional ways of buying and selling properties aren’t the only ways of building wealth using real estate

Furthermore, after understanding the avenues for generating profits via real estate, one needs to know how to invest money for high returns. 

[**Read Now**](https://www.propreturns.com/resources/blogs/real-estate-returns-in-india)



Property Investment Basics

# COMMERCIAL REAL ESTATE INVESTMENT

Commercial properties are the ones that are used for business / non-residential purposes or income generation (by selling / leasing). Any investment in such properties with the intention of generating a cash flow is called commercial investment.

This section of ‘The Ultimate Guide to Buy, Sell, and Rent Commercial Real Estate’ is dedicated to warming you up. It’s a starting point for anyone who wants to begin with commercial real estate investing. Let’s dive in!

## Should you invest in commercial or residential real estate?

Nowadays, owning physical Real Estate has become a necessity. As Real Estate is a popular form of diversification and has the potential to beat inflation, investing in it secures your finances and future. The commercial and residential real estate sectors offer a wide variety of investment options. But, if you are unfamiliar with the Real Estate investment world, investing can get confusing.

To help you better understand the scope of investing in commercial and residential Real Estate and help you decide which one is best for you, we have covered both these segments in great depth. 

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/should-you-invest-in-commercial-or-residential-real-estate) 


## Beginner's Guide to Commercial Property Investment

Being the top choice of savvy investors, India’s commercial real estate is expected to grow at a CAGR OF 13% between 2022-2027.

Besides, Indian real estate is expected to reach $1 billion by 2030, with commercial real estate being a major contributor supporting the growth of the sector. Investors in the real estate sector have always considered commercial property investment a rewarding investment choice, that gives high ROI, capital appreciation, and passive income opportunities.

In this piece, we will cover all about Indian Commercial Real Estate Investments.

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/beginners-guide-to-commercial-property-investment)

## Pre-leased Commercial Property: How to Earn Rental Income

Investors who want a consistent source of income frequently choose to invest in pre-leased real estate. This is a type of investment that can give you rental income right away, without the burden of looking for a person who wants to stay at rent. 

In this blog, we will look into aspects like preleased property investment analysis, how to calculate ROI, disadvantages, and more. 

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/pre-leased-property)


Commercial Real Estate

# PRELEASED COMMERCIAL PROPERTY INVESTMENT

A pre-leased property means a property that has previously been leased to a tenant before being sold to a buyer. The building might be either residential or commercial. In other words, the renter stays put after the property is sold, making the new owner the landlord. The prior owner transfers to the new owner the lease that was signed by the renter and the former owner. The previous tenant is still using the property and pays rent to the new owner. 

Pre-leased commercial real estate has become a popular choice among investors. The blogs below will tell you why. 

## 1. Pre-leased schools:

If you're curious about the untapped potential of pre-leased schools and the countless benefits it can offer, you've come to the right place! This blog will serve as your comprehensive guide to understanding why investing in pre-leased schools in India is a decision you won't want to overlook.

[**Read More**](https://www.propreturns.com/resources/blogs/why-you-should-consider-investing-in-preleased-schools-in-india)

## 2. Pre-leased Malls:

In a world where the retail landscape is constantly evolving, astute investors are turning their attention towards pre-leased malls as a potential game-changer in the real estate market. The notion of owning a stake in shopping centers that are already tenanted with reputable brands and businesses is undeniably tempting, and we're here to uncover all about this investment anevue.

[**Read More**](https://www.propreturns.com/resources/blogs/are-pre-leased-malls-a-good-investment)

## 3. Pre-leased banks:

Join us as we delve into the world of bank pre-leased properties and understand why they have become the talk of the town among seasoned investors. From the unwavering stability of long-term leases to the prestigious appeal of having esteemed financial institutions as tenants, you'll discover the unparalleled charm of this investment avenue. 

[**Read More**](https://www.propreturns.com/resources/blogs/benefits-of-investing-in-bank-pre-leased-properties)

## 4. Preleased Warehouses:

In the dynamic landscape of real estate investments, warehouses have emerged as an unassuming yet powerful asset class, attracting the attention of investors seeking a smart way to diversify their portfolios. These unassuming structures play a pivotal role in the logistics and supply chain industry, making them a critical component of the booming e-commerce era.

Join us as we delve into the heart of what makes warehouse property an exceptional investment choice.

[**Read More**](https://www.propreturns.com/resources/blogs/a-quick-overview-into-what-makes-warehouse-property-a-good-investment)

Preleased Commercial Property

# RENTAL YIELD

Rental yield is a fundamental indicator that measures the potential profitability of a property, making it an essential tool for every investor's arsenal. It measures the return on investment you can expect to receive from renting out your property. 

In India's rapidly growing real estate market, rental yield can be a game-changer for property investors. By understanding the importance of rental yield and its impact on your overall returns, you can make informed investment decisions and maximize your profits.

Below are just the resources you need to understand rental yield for practical use. 

## How to Get Better Rental Yield in India

In this blog, we'll delve deep into the strategies, tips, and insights to help you boost your rental yield in this thriving metropolis. Mumbai's real estate market is a unique blend of opportunities and challenges, making it essential to navigate with expert guidance.

Join us as we explore the factors that impact rental yield, such as location, property type, and current market trends. 

[**Read More**](https://www.propreturns.com/resources/blogs/maximizing-rental-yield-in-india)

## 10 Must-Read Books for Rental Property Investing 2023

Whether you're a seasoned real estate investor looking to fine-tune your skills or a beginner eager to jump-start your journey, this blog is a goldmine of knowledge for all levels of expertise. Uncover the wisdom from renowned authors who have already achieved remarkable success in the rental property market.

[**Read More**](https://www.propreturns.com/resources/blogs/books-for-rental-property-investing)


Rental Yield

# REAL ESTATE INVESTMENT TRUSTS (REITs)

Real Estate Investment Trusts (REITs) are witnessing a surge in popularity among Indian investors, thanks to their convenience and accessibility. REITs serve as investment vehicles that enable individuals to participate in income-generating real estate assets. Under the regulation of the Securities and Exchange Board of India (SEBI), both retail and institutional investors are increasingly drawn to these opportunities.

To grasp the concept of REITs, consider a simple example where a group of friends pool their money to purchase a rental property. Each friend contributes funds and receives a share of the rental income generated. REITs work similarly, but on a larger scale.

This article serves as your comprehensive guide on investing in REITs in India. Discover the numerous benefits of investing in these funds, as well as the attractive tax advantages they offer for investors. Get ready to explore the world of REIT investing and unlock the potential for profitable ventures in the real estate market.

## Fundamentals: Real Estate Investment Trust India 

To invest in Real Estate Investment Trusts (REITs), it is crucial to grasp the fundamentals of this asset class. Fortunately, the blog provided below serves as a comprehensive guide, presenting all the essential aspects of REITs in a clear and simplified manner. 

From explaining what REITs are and how they function to outlining the benefits and risks associated with them, the blog equips aspiring investors with the necessary knowledge to make informed decisions. 

**Read:** [**All about REITs in India**](https://www.propreturns.com/resources/blogs/all-about-reits-in-india) 

## Advance: How to get started with REITs in India 

If you are thinking about investing in REITs and you have a fair idea of what they are, the next step is to understand how to get started. While you may be in a hurry to find the perfect way to start investing, there are a few techinicalities that you must know about.

Such as, how do REITs work, what qualifies as REIT, what are the expected returns, limitations and advantages, taxes involved, and more. 

The blog below is an easy guide for you to understand all the above and make an informed decision. 

**Read:** [**How to Invest in REITs in India**](https://www.propreturns.com/resources/blogs/how-to-invest-in-reit-in-india-and-the-benefits-of-investing-in-reit)


REITs

# REAL ESTATE MUTUAL FUNDS

Investing in various areas of investments like residential apartments, commercial spaces, and even high-rise office complexes in prime locations like Mumbai, Delhi, or Bangalore is a sure shot to give you a rewarding return. But how can a normal resident like you and me can invest in such huge markets?

With real estate mutual funds, this dream becomes a reality. For instance, you could become a shareholder in a fund that owns a luxury resort in Goa, a tech park in Hyderabad, or a shopping mall in Chennai.

The possibilities are endless!

But it's not just about the potential for high returns and owning a slice of India's vibrant real estate market. Real estate mutual funds also offer the convenience of professional management, ensuring your investment is in the hands of experienced fund managers who understand the nuances of the industry. Moreover, these funds provide liquidity, allowing you to easily buy or sell shares on any business day, unlike the challenges of selling a property.

[**Read More**](https://www.propreturns.com/resources/blogs/real-estate-mutual-funds)


Real Estate Mutual Funds

# FRACTIONAL OWNERSHIP

The fractional ownership market in India is experiencing steady growth. This new trend enables individuals to own a share of exclusive beachfront properties in Mumbai or commercial spaces in Delhi, thanks to fractional property investment.

With the commercial real estate market expected to grow by 16% in the upcoming years, the demand for fractional property investment is set to rise as well. This approach reduces the financial burden on single property owners or investors.

Essentially, fractional ownership is an innovative method that grants people the opportunity to own a part of a property, making real estate investment accessible with lower capital requirements. Unlike traditional ownership, where one person owns the entire property, fractional ownership allows multiple investors to collectively own the property and share its benefits.

**Read more here:** 
[**Fractional Property Investment: All you need to know**](https://www.propreturns.com/resources/blogs/fractional-property-investment)


Fractional Ownership

# RECOMMENDED INDIAN CITIES 

When it comes to investing in commercial property, choosing the right location is crucial. A prime location not only attracts customers, tenants, and businesses but also boosts the property's long-term value.

So, what should you look for when selecting that perfect spot? Factors like accessibility, visibility, nearby amenities, local infrastructure, and even demographic trends should be carefully considered. But don't worry, we've got you covered! In this guide, we'll take a closer look at these key considerations to help you make well-informed and strategic choices for your commercial property investment.

## 3 Best Cities to Invest in Real Estate in India

Now, let's talk about the three best cities where commercial property investment is taking off. These cities offer fantastic opportunities for growth and success, so keep reading to discover the hotspots that are making waves in the market!

[**Read More**](https://www.propreturns.com/resources/blogs/top-3-cities-to-invest-in-real-estate-in-india)

## Delhi NCR

If you're curious about the exciting world of commercial real estate in Delhi NCR, we've got a treat for you! This blog takes you on a journey through this booming market, where opportunities are plenty, and potential for growth is sky-high. We'll explore the hottest trends, bustling areas, and key factors driving the commercial property scene in Delhi NCR. 

[**Read More**](https://www.propreturns.com/resources/blogs/commercial-real-estate-in-delhi-ncr-a-booming-market)

## Mumbai 

Mumbai, also known as the financial capital of India, presents a vibrant and lucrative market for commercial property investment. With its dynamic business ecosystem, diverse industries, and a population of millions, the city offers tremendous potential for savvy investors like you.

Below are the resources that you must read to know all that Mumbai holds for Real Estate:

1. [**Benefits of investing in Commercial Real Estate in Mumbai**](https://www.propreturns.com/resources/blogs/benefits-of-investing-in-commercial-real-estate-in-mumbai) 

2. [**Top Places near Mumbai for Real Estate Investment**](https://www.propreturns.com/resources/blogs/top-places-near-mumbai-for-real-estate-investment) 

3. [**Commercial Propertie for Rent in Mumbai: Top 5 Locations**](https://www.propreturns.com/resources/blogs/commercial-properties-for-rent-in-mumbai) 

## Gurgaon

Location has become the most crucial factor for buying a property. Location is the key to good property appreciation, ROI, rental income, and rental yield. Hence, investing in a commercial property in investment hotspots can give you fascinating profits. Among major investment hotspots in Delhi NCR, Gurgaon is one location that can reap lucrative returns even with a small investment amount.

**Read more** about benefits of investing in Gurgaon [**here**](https://www.propreturns.com/resources/blogs/benefits-of-investing-in-commercial-properties-in-gurgaon) 


Recommended Cities

# List of Property Taxes on Commercial Properties in India

## Overview of Property Taxes in India

Property taxes in India are an important source of revenue for the government at various levels. These taxes are levied on property owners based on the value of their properties and are used to fund local infrastructure and services. The property tax system in India varies across states and municipalities, but there are several common types of property taxes that are prevalent throughout the country. We will see about them in detail below.

## 1.  Municipal Corporation Tax 

Municipal corporations or local bodies levy this tax on properties located within their jurisdiction. The tax is based on the annual rental value or the capital value of the property. Municipalities determine tax rates, which can vary based on factors such as property type, location, and usage.

Learn more [here](https://www.propreturns.com/learn/municipal-property-tax-on-commercial-property-in-india) 

## 2. Goods and Services Tax (GST) 

GST is a unified indirect tax levied on the sale of goods and services in India. In the case of under-construction properties, GST is applicable to the value of construction services provided by developers or builders. However, the sale of properties with completion certificate and  is exempt from GST.

Useful reads: [GST on Sale of Commercial Property](https://www.propreturns.com/resources/blogs/gst-on-sale-of-commercial-property)
[GST on Commercial Property Rent](https://www.propreturns.com/resources/blogs/gst-on-sale-of-commercial-property)

## 3. Capital Value Tax

Capital Value Tax is levied on the sale or transfer of property. It is calculated as a percentage of the property's market value or the consideration amount mentioned in the sale deed. This tax is typically paid by the buyer or transferee of the property.

## 4. Stamp Duty and Registration Charges

Stamp duty is a state-level tax imposed on the execution of documents related to the transfer of property. It is calculated as a percentage of the property's market value or the consideration amount mentioned in the document, whichever is higher. Registration charges are fees paid for registering the property transaction with the government authorities.

Useful read: [How to pay stamp duty online?](https://www.propreturns.com/resources/blogs/how-to-pay-stamp-duty-online)

## 5. Income Tax on Rental Income 

Property owners in India are required to pay income tax on the rental income earned from their properties. The income tax rate applied depends on the property owner's income slab and other relevant factors. Expenses related to property maintenance and rental income deductions can also be claimed to reduce taxable income.

Invest in [pre-leased commercial property](https://www.propreturns.com/resources/blogs/how-to-pay-stamp-duty-online) in India and get rent on your commercial property from the get-go! 

## 6. Property Transfer Tax 

Property transfer tax is levied when ownership of a property is transferred from one person to another. This tax is imposed by some states in India and is calculated as a percentage of the property's market value or the consideration amount mentioned in the transfer document.

## 7. Tax Deduction at Source (TDS) 

TDS is a mechanism through which taxes are deducted from the source of income. When purchasing a property from a non-resident Indian (NRI), the buyer is required to deduct TDS from the sale consideration and deposit it with the income tax authorities. This ensures that taxes on capital gains made by NRIs from the sale of property in India are paid.

## 8. Other Taxes and Levies

In addition to the property taxes mentioned earlier, commercial property owners in India may encounter several additional taxes and levies. Some of the common additional taxes and levies include:

**Development Charges**: Development charges are levied by local authorities or development authorities to fund infrastructure development projects in the area.

**Local Improvement Charges**: Local improvement charges (LIC) are imposed by local authorities for specific local infrastructure improvements or services. 

**Lease Tax**: Some states levy a lease tax on commercial properties that are rented out. This tax is applicable to the rental income earned by the property owner and is calculated as a percentage of the rental value or the actual rent received.

**Service Tax**: Service tax is applicable to certain services provided in relation to commercial properties, such as maintenance and repair services, legal services, architectural services, and property management services. 

**Browse the upcoming topics to deep dive into each of these Commercial Property Taxes.**

Commercial Property Taxes in India

## Municipal Property Tax on Commercial Property in India

Property tax in India is a tax levied by the government on the value of real estate property, such as land, buildings, and other immovable assets. The tax is typically based on the assessed value of the property and is paid annually by the property owner to the local municipal corporation or government authority.

The property tax calculation formula in India can vary depending on the state or municipality in which the property is located. However, here is a general formula that is commonly used:
Property tax = Base value of the property x Rate of tax x Age factor x Usage factor x Type of property factor
Talking about Exemption, certain individuals or entities may be exempted from paying property tax under certain conditions. The exemptions may vary from state to state and from municipality to municipality.

[**Learn More**](https://www.propreturns.com/resources/blogs/property-tax-in-india-what-is-it-and-how-is-it-calculated)

Below are the guides to pay property taxes in Mumbai and Delhi


## How to pay MCGM Property Tax in Mumbai

Paying property tax is a mandatory requirement for all property owners. However, the traditional process of paying property tax in Mumbai can be a cumbersome task, involving long queues and multiple visits to the Municipal Corporation of Greater Mumbai (MCGM) offices. 

With the advancement of technology, the MCGM has now introduced the facility to pay property tax online, making the process much more convenient and hassle-free.

In this guide, we will take you through the step-by-step process of paying MCGM property tax payment online in Mumbai.

[**Learn More**](https://www.propreturns.com/resources/blogs/how-to-pay-bmc-property-tax)


## How to pay NMMC Property Tax in Navi Mumbai

Navi Mumbai Property tax is a tax levied on the value of real estate properties owned by individuals or entities, which is paid to the Navi Mumbai Municipal Corporation. The NMMC property tax payment collected by the NMMC is used to fund various civic amenities such as road maintenance, garbage collection, and public health services.

The NMMC has taken several steps to make the property tax payment process easy and transparent for property owners in Navi Mumbai.

## How to Pay Property Tax in Delhi

Gone are the days when paying property tax was a cumbersome and time-consuming task that involved standing in long queues and navigating confusing government procedures. Thanks to modern technology, Delhi's online property tax payment is now a hassle-free and straightforward process that you can complete in just a few clicks from the comfort of your home or office.

[**Learn More**](https://www.propreturns.com/resources/blogs/how-to-pay-property-tax-in-navi-mumbai)

[**Learn More**](https://www.propreturns.com/resources/blogs/how-to-pay-property-tax-in-navi-mumbai)





Municipal Property Tax

# Taxes on the Sale of Commercial Property in India

Selling and buying commercial properties is a complicated process when you don’t know the A-B-C-D of the taxes involved. Navigating the ins and outs of taxes on the sale of commercial property can be a daunting task.

But don't be alarmed, we are providing you with comprehensive articles to clear all your doubts about taxes on the sale of commercial property, its implications, rules, and more. 

## GST on Sale of Commercial Property 

Many countries including India, have indirect taxing on the supply of goods and services. This is what we call the GST, the Goods and Services Tax. The GST on property refers to the tax that is applicable on the sale of immovable property, such as land or buildings, whether residential or commercial.

GST on the sale of commercial property in India is not applicable for all types of properties though. For example, the sale of under-construction or newly constructed commercial properties attracts a tax rate of 18% on the value of the property. However, the sale of fully constructed commercial properties or resale of commercial properties is exempt from GST.

[**Learn More**](https://www.propreturns.com/resources/blogs/gst-on-sale-of-commercial-property)

## GST on Under Construction Commercial Property

Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and services in India. The GST rate on under-construction commercial property is 12%. However, there are some exemptions and concessions available. For example, the GST rate on affordable housing is 1%.

The GST on under-construction commercial property is paid by the developer to the government. The developer then recovers this GST from the buyer as part of the purchase price. The buyer can claim a refund of the GST paid on the under-construction commercial property if the property is not ready for occupation within a certain period of time.

The GST on under-construction commercial property is a complex area of law. It is important to seek professional advice if you are considering buying or selling under-construction commercial property.

## Capital Gains Tax on Commercial Property

The year 2023 has seen a surge in the Indian real estate market, with property prices soaring to new heights. As more and more individuals look to sell their properties for a tidy profit, it is important to understand the implications of capital gains tax on the sale of property in India.

Capital gains tax is levied on the profit earned from the sale of a property, and it is an important aspect to consider when selling property in India.


[**Learn More**](https://www.propreturns.com/resources/blogs/all-you-need-to-know-about-capital-gains-and-taxes-on-sale-of-property-in-india)



Tax on Sale of Commercial Property

# Tax on Rental Income in India

## How to Calculate GST on Commercial Property Rent 

GST on rent paid on commercial property is an important consideration to make. Under the GST regime, commercial property rent is considered a taxable supply of services. As a result, both the landlord and the tenant need to be aware of the GST implications on commercial property rent to avoid any penalties or legal issues.

Talking about commercial properties, if you are looking to rent on, click here.

So, let's dive into this topic and explore the various aspects of GST on commercial property rent in India, including the applicable rates, threshold limits, input tax credits, and more.

[**Learn More**](https://www.propreturns.com/resources/blogs/gst-on-commercial-property-rent)


## TDS on Rent Paid to NRI

If you are a non-resident Indian (NRI) with a property in India that you rent out to a tenant, you ought to know about tax on rental income. Understanding how to calculate tax on rental income for NRIs is crucial to ensure compliance with Indian tax laws. NRIs must be aware of the applicable rates, exemptions, and procedures to accurately calculate and remit TDS on rent to the Indian government.

Tax Deducted at Source (TDS) is a tax collection mechanism in India that requires the payer to deduct a percentage of tax from the payment made to the payee. This tax is then remitted to the government on behalf of the payee.

[**Learn More**](https://www.propreturns.com/resources/blogs/tds-on-rent-paid-to-nri-in-india-everything-you-must-know)

Tax on Rental Income

# DOCUMENTS FOR COMMERCIAL REAL ESTATE TRANSACTIONS

When venturing into the world of commercial property, whether for renting or purchasing, being well-prepared is key to a smooth and successful transaction. Understanding the essential documents required for these transactions can save you time, reduce stress, and ensure that you have all the necessary information at your fingertips. 

Not having the required documents during the process of renting or purchasing a commercial property can lead to a range of significant challenges and potential pitfalls. 

Firstly, it may result in delays and setbacks, causing frustration and hindering progress in finalizing the deal. Without the necessary documents, you may not have a clear understanding of the property's legal status, financial history, or any potential liabilities associated with it. This lack of information can leave you vulnerable to unforeseen risks and hidden costs, potentially leading to financial losses in the future. 

Moreover, landlords or sellers may question your credibility and seriousness as a potential tenant or buyer, diminishing your chances of securing the property you desire. 

To safeguard your interests and ensure a smooth transaction, it is crucial to have all the required documents in place before proceeding with any commercial property rental or purchase.

From rental agreements to property deeds and financial records, having a comprehensive set of documents will empower you to make informed decisions and move with confidence. 

In this guide, we'll walk you through the crucial documents you'll need to navigate the renting or purchasing process like a pro. 

Let's get started!

Documents

# DOCUMENTS FOR COMMERCIAL PROPERTY RENTING 

There are several documents that play an important role when one wants to lease a commercial property. 

Landlords usually ask for a completed rental application, financial statements or tax returns to check your financial stability, business licenses or permits, and references from past landlords or business associates to see if you're a reliable tenant. 

Now, a trickier document is a ‘**rent agreement**’. A rent agreement for commercial property, also called a commercial lease, is a legal contract between a landlord and a business tenant. This agreement outlines the terms and conditions for the tenant to use the commercial space for a specific period. It includes important details such as the rent amount, lease duration, payment schedule, and any extra fees or charges. The agreement also states the responsibilities of both the landlord and the tenant, including maintenance and repairs. 

Having a comprehensive and well-written rent agreement is vital to protect both parties' interests and ensure a smooth and friendly landlord-tenant relationship throughout the lease term.

Below are elaborative guides to various types of rent agreements for commercial use: 

1. [**Commercial Rental Agreement**](https://www.propreturns.com/resources/blogs/commercial-rental-agreement)

2. [**Office Rent agreement format**](https://www.propreturns.com/resources/blogs/office-rent-agreement-format) 

3. [**Shop Rent Agreement**](https://www.propreturns.com/resources/blogs/rent-agreement-format-for-a-shop-a-comprehensive-guide) 

**Find free rent agreement format in Word** [**here**](https://www.propreturns.com/tools/free-rent-agreement-format-in-word-commercial)


Rent

# DOCUMENTS FOR COMMERCIAL PROPERTY PURCHASE

When purchasing a commercial property, documents play a crucial role in verifying ownership, checking for any encumbrances, and understanding the terms and conditions of the purchase. 

From property title deeds and tax clearance certificates to sale agreements and financial records, each document serves a vital purpose in safeguarding your interests as a buyer. 

Properly preparing and presenting these documents will not only expedite the buying process but also provide you with the confidence and assurance you need to make an informed decision when investing in a commercial property.

To get a good understanding of these documents, we have listed two resources below:

1. [Documents for Commercial Real Estate Purchase](https://www.propreturns.com/resources/blogs/property-documents-checklist-for-real-estate-purchase)

2. [Agreement to Sell](https://www.propreturns.com/resources/blogs/agreement-to-sell-what-you-need-to-know)


Purchase

# COMMERCIAL PROPERTY LOAN

Whether you aim to purchase office spaces, retail outlets, industrial complexes, or multifamily properties, securing the right commercial property loan is the cornerstone of your success. 

However, we understand that the intricacies of commercial lending can be daunting. But don’t worry, we're here to simplify the process and equip you with tips to secure the funding you need to turn your real estate dreams into reality.

But, why opt for a commercial property loan?

Commercial property loans are specifically tailored to help businesses and investors acquire or refinance income-generating properties. Unlike residential mortgages, these loans take into account factors such as the property's potential rental income, the creditworthiness of the borrower, and the overall financial strength of the project.

The blogs listed below will help you understand commercial loans in detail. 

## 1. Commercial Property Loan: Basics, Eligibility & Documents

Before diving into the complexities, it's essential to grasp the fundamental principles of these loans. We'll explore how eligibility, required documents, benefits, and some tips. 

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/commercial-property-loan-basics-eligibility-and-documents?abtwe=we) 

## 2. Tax Benefits of Loan Against Property 

Taking a loan against property emerges as a popular choice for many. However, what remains lesser-known to many is that these loans offer tax benefits, making them an even more appealing financing option. 

Availing a loan against property brings with it a range of advantages that can effectively lower the overall cost of borrowing, with tax benefits being one of the most significant perks. 

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/loan-against-property-tax-benefits) 

##3.  Commercial property loan interest rates in India

In this article, we provide you a complete guide on commercial property loan rates in India and how to apply for commercial property loans. Let's dive in!

[**Go to the Blog**](https://www.propreturns.com/resources/blogs/commercial-property-loan-rates-in-india) 

## Bonus: EMI Calculator

Calculate an estimate of your [**Loan EMI**](https://www.propreturns.com/tools/emi-calculator) now. 

Loan for Commercial Property

# REAL ESTATE  REGULATION

In India, the regulation of commercial properties is overseen by three crucial entities: the **Real Estate Regulatory Authority (RERA), the Inspector General of Registration (IGR), and the Ready Reckoner Rate**. 

RERA, established in 2016, focuses on promoting transparency and accountability in the real estate sector. It requires developers to register their projects, disclose project details, and ensures timely project completion. 

The IGR plays a vital role in overseeing property registrations and verifying transaction documentation, safeguarding the rights of buyers and sellers. 

Finally, the Ready Reckoner Rate, determined by the government, serves as a reference for calculating stamp duty and registration charges during property transactions. 

By employing these regulatory mechanisms, India aims to create a level playing field for commercial real estate, fostering confidence among stakeholders, curbing malpractices, and facilitating fair property transactions in the country.

We have gathered insights into these **regulatory authorities in Delhi and Mumbai**. If you are looking to build, sell, or buy commercial real estate in these cities, you must have a look at these:

1) **Real Estate Regulation in Delhi**
2) **Real Estate Regulation in Mumbai**


Regulation

# REAL ESTATE REGULATION IN DELHI

Real estate regulation in Delhi is governed by multiple laws and authorities to ensure transparency, fair practices, and protection of both buyers and sellers. The key regulatory aspects in Delhi include:

## 1. Real Estate Regulation and Development Act, 2016 (RERA), Delhi 

RERA is a central legislation that applies to the National Capital Territory (NCT) of Delhi as well. 

[**Learn More**](https://www.propreturns.com/resources/blogs/delhi-rera-decoded-for-realty-agents-promoters-buyers)

## 2. Stamp Duty and Registration
Delhi levies stamp duty on various real estate transactions, including property sales, leases, and transfers. The rate of stamp duty is subject to periodic revisions and varies based on the nature of the transaction and the property's location and value.

[**Learn More**](https://www.propreturns.com/resources/blogs/property-registration-in-delhi-igrs)

[**Calculate Stamo Duty**](https://www.propreturns.com/tools/stamp-duty-calculator)

## 3. Building Bye-Laws: 

The Municipal Corporation of Delhi (MCD) and other local bodies enforce building bye-laws that dictate construction norms, building heights, setbacks, and safety standards for commercial properties.

## 4. Circle Rate Delhi

Circle Rates are the minimum rates at which the sale or transfer of a property is registered with the government authorities. These rates are determined by the respective state governments and are revised periodically. Circle Rates serve as the basis for calculating stamp duty and registration charges on property transactions in Delhi.

[**Learn More**](https://www.propreturns.com/resources/blogs/circle-rate-in-delhi-in-2022)

## 5. Delhi Land Reforms Act: 

This act governs the regulation of agricultural land in Delhi and prohibits its use for non-agricultural purposes without proper authorization.
 
## 6. Environmental Regulations: 

Delhi follows various environmental regulations to protect the city's air, water, and land resources. Environmental clearances may be required for certain real estate projects, especially those located in ecologically sensitive areas.

## 7. Rent Control Laws: 

Delhi has its own rent control laws that regulate the leasing of properties. The Delhi Rent Control Act governs the rental agreements and rent fixation for both residential and commercial properties in the city.

## 8. Delhi Development Authority (DDA): 

The DDA is responsible for the planned development of Delhi. It formulates and implements land use and zoning regulations, which specify the permissible uses of land in different areas of the city. These regulations help maintain the balance between residential, commercial, and industrial developments and prevent unauthorized constructions.

Compliance with these real estate regulations is crucial for developers, buyers, and other stakeholders in Delhi's real estate market. These regulations aim to create a transparent and accountable real estate sector, protect the interests of consumers, promote sustainable urban development, and maintain the overall harmony and growth of the city.


Delhi

# REAL ESTATE REGULATION IN MUMBAI, MAHARASHTRA

Commercial property regulation in Maharashtra, including Mumbai, was governed by various laws and regulations to ensure orderly and efficient growth of the commercial real estate sector. It is essential to note that regulations might change over time, so it's always best to verify the latest information from official sources.

In Maharashtra, the key regulatory bodies responsible for overseeing commercial property include:

## 1. Maharashtra Real Estate Regulatory Authority (MahaRERA)

MahaRERA is a regulatory authority established to protect the interests of homebuyers and investors in real estate projects, including commercial properties. Developers of commercial projects must register their projects with [**MahaRERA**](https://www.propreturns.com/resources/blogs/maharera-blacklisted-projects-list), providing comprehensive details about the project, timelines, and expected completion dates.

## 2. Brihanmumbai Municipal Corporation (BMC) 

BMC is the civic body responsible for governing and regulating construction activities in Mumbai. It grants construction permits, oversees building safety, and ensures compliance with zoning, collects property taxes, and development norms. 

[**Learn More**](https://www.propreturns.com/resources/blogs/how-to-pay-bmc-property-tax)

## 3. Stamp Duty and Registration

Commercial property transactions require payment of stamp duty and registration fees as per the prevailing rates. This is done through [**IGR Maharashtra**](https://www.propreturns.com/resources/blogs/igr-maharashtra-gov-in-mumbai)  

## 4. Mumbai Metropolitan Region Development Authority (MMRDA)

MMRDA is responsible for planning, coordinating, and supervising the development of the Mumbai Metropolitan Region (MMR). They play a crucial role in infrastructure development and the allocation of land for commercial purposes.

## 5. Development Control Regulations (DCR)

DCR is a set of rules and guidelines formulated by the respective municipal corporations, including BMC in Mumbai, to regulate construction and development activities within the city. It specifies various parameters such as permissible FSI (Floor Space Index), building heights, setbacks, land use, etc., for commercial properties.

## 6. Ready Reckoner Rate 

Ready Reckoner Rate, also known as Circle Rate or Guidance Value, is a crucial aspect of property transactions in Maharashtra, including Mumbai. It is the minimum rate at which the sale or transfer of a property is registered with the government authorities.

[**Learn More**](https://www.propreturns.com/resources/blogs/all-about-ready-reckoner-rate-in-maharashtra-2023)  

The Ultimate Guide to Buy, Sell, or Rent Commercial Properties

Real Estate Investment

Property Investment Basics

Commercial Real Estate

Preleased Commercial Property

Rental Yield

REITs

Real Estate Mutual Funds

Fractional Ownership

Recommended Cities

Commercial Property Taxes in India

Municipal Property Tax

Tax on Sale of Commercial Property

Tax on Rental Income

Documents

Rent

Purchase

Loan for Commercial Property

Regulation

Delhi

Mumbai

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