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REAL ESTATE MUTUAL FUND SCHEME

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Real estate mutual fund scheme means a mutual fund scheme that invests directly or indirectly in real estate assets or other permissible assets. 

Under this scheme, the Asset Management Company raises funds from individual investors for the purpose to invest in real estate assets.

Real Estate Mutual Fund (REMF) allows retail investor to participate in this fund without taking physical possession of any asset. 

FEATURES:

(i) The existing mutual funds are eligible to launch such schemes;

(ii) New sponsors seeking to set up new mutual funds shall be carrying on the business of real estate for at least 5 years;

(iii) It shall always be a close – ended scheme;

(iv) NAV of the scheme shall be declared daily;

(v) At least 35% of the net assets of the scheme shall be invested directly in the real estates;

(vi) Each asset shall be valued by at least two valuers who are accredited by a CRA;

(vii) No mutual funds shall transfer real estate assets amongst its schemes;

(viii) Such schemes shall not undertake any lending or housing finance activities;

(ix) Accounting and valuation norms pertaining to REMF schemes have also been specified.

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