GOA: Foreigners beware when buying property

Change In Laws, Builder Scams Threaten Investment Of Hundreds Of Foreigners In State

Nicola Smith

Hundreds of Britons may lose their holiday homes and life savings in Goa after falling foul of changes in local laws and scams by builders and lawyers. Some allege they are victims of racism and have been told to ‘‘go home’’.

Many invested tens of thousands of pounds a few years ago in legitimate transactions, only to be told the rules had changed and their properties may be confiscated. In one of the most common scenarios in Goa, British buyers were told by local lawyers and the Reserve Bank of India that they could legally own property if they set up an Indian company and made the transaction through it. By 2007, the rules on foreigners owning property through a business appeared to have changed, though only in Goa.

The region used to be part of the hippie trail, but has reinvented itself as a package-holiday centre. It attracts 1,00,000 British holidaymakers a year, 60% of its foreign tourist trade.

The new interpretation of the law by the Goan authorities has left hundreds, such as Su Peplow, 57, from Bedfordshire, without property deeds and facing large financial losses.

In 2005, Peplow, a quality director for a human tissue research association, decided to retire to Goa with her husband. They settled on a two-storey flat under construction in Cavelossim, a fishing village, and invested more than £20,000. The couple signed a contract for a
56-month lease with a right to buy. Like many others, they hired local lawyers to help them and were advised to set up a business to buy the flat.

Peplow’s husband died in 2006 and she decided to proceed with the purchase alone. She paid the builder for registration of the deeds, transfer of the utilities into her name, land tax and stamp duties. She also handed over £6,500 for furniture and renovation, and paid legal fees.

After she paid the final instalment to the builder, he reportedly said he could not transfer the deeds as he would be ‘‘breaking Goan laws’’. Her lawyer disappeared and she stands to lose her entire investment when the lease runs out.

Another Briton said despite a letter from RBI affirming that she had done everything legally, she was told by a local subregistrar that he ‘‘couldn’t register our property as I was white and a foreigner’’.

Vikram Varma, a local lawyer, said more than 1,000 people could have been caught out by changes in the laws and by builders’ scams. The British deputy high commissioner is being sent to Goa to hear people’s concerns.

The enforcement directorate and Goan government declined to comment.

The difficulties coincided with a popular movement opposing the purchase of large tracts of land by Indian and Russian developers as Goans fear losing their cultural identity.

SUNDAY TIMES, LONDON
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