The short answer: most foreign investors can buy residential and commercial real estate in both Kentucky and Indiana. The long answer changed in 2025 and again in 2026, and if you're buying in Southern Indiana, or you're a fund with investors from overseas, you need to know it.

This guide covers the Kentucky law, the new Indiana law, and the federal rules that sit on top of both, in plain language.

Kentucky: restrictions on agricultural land only

In 2025, Kentucky passed House Bill 315. It stops certain foreign buyers from purchasing, leasing or acquiring agricultural land in Kentucky. Who's covered: a nonresident alien, foreign business, foreign agent, trustee or fiduciary that has a legal relationship with, or is legally bound to take instruction from, the government of a country on the federal "proscribed countries" list for arms exports (the list at 22 CFR 126.1, which includes China, Iran and North Korea, among others).

What it doesn't cover: residential and commercial property. Kentucky's law is about farmland. The law also has some exceptions, including a limited research exception and allowances for land being developed for non-agricultural business use.

So for a foreign investor buying a Louisville rental, apartment building, warehouse or storefront, Kentucky's law usually isn't the issue. If you're buying farmland or a large rural tract, it may be. Rural and horse-farm buyers should read our Fayette County horse farm guide and talk to an attorney.

Indiana: a much broader law as of July 1, 2026

Indiana has been tightening this for a few years. A 2022 law restricted foreign businesses from buying farmland. A 2024 law, House Enrolled Act 1183, added pastureland and land within 10 miles of military installations.

Then in 2026, Indiana passed Senate Enrolled Act 256, effective July 1, 2026. It extends the restriction to all real property in Indiana, including residential and commercial real estate, plus mineral, water and riparian rights.

Which countries

The law names China, Russia, North Korea and Iran, and adds any foreign government on the federal Commerce Department's foreign adversary list (15 CFR 791.4), which has also included Cuba and Venezuela's Maduro regime, plus any country the Indiana governor designates as a threat to critical infrastructure. Because that federal list can change, check the current version with your attorney before buying.

Who's a "prohibited person"

• Citizens or people domiciled in a foreign adversary country.
• Businesses organized in or headquartered in a foreign adversary country.
• Entities where a "controlling person" is from a foreign adversary country. That includes someone with 51% or more ownership, board or officer roles with inside information, or the ability to influence management directly or indirectly.
• Agents, trustees and fiduciaries acting for any of the above.

The exceptions

• US citizens, including dual citizens.
• Lawful permanent residents (green card holders) and people granted asylum.
• People with a valid nonimmigrant visa that runs more than 12 months past the purchase can buy one property if it's zoned single-family, is half an acre or less, and they've been determined not to be an agent of a foreign adversary.
• Prohibited persons can still lease residential property for 24 months or less.
• People who already owned Indiana property before July 1, 2026 can generally keep it unless the state proves they're acting as an agent of a foreign adversary.

Penalties

A violation can bring a civil penalty of 10% of the property's market value and forced sale of the property through a receiver.

What this means in Southern Indiana

Unless a buyer meets the law's "prohibited person" definition, nothing changes, and most foreign investors don't. For buyers who do meet it, Indiana purchases are restricted, while Kentucky's law is limited to agricultural land. Whether the definition reaches you, your company or your investors is a question for an attorney.

Federal rules that apply in both states

Property near military bases

The federal Committee on Foreign Investment in the United States (CFIUS) can review certain foreign purchases of real estate near listed military installations. Fort Knox and Fort Campbell are on that list, and CFIUS jurisdiction reaches at least one mile around them, with some installations covered further out. If you're buying near either base, tell your attorney early.

Foreign-owned farmland reporting

Foreign owners of US agricultural land must report it to the US Department of Agriculture under the Agricultural Foreign Investment Disclosure Act (AFIDA). In June 2026, USDA proposed tightening those rules, including lowering the ownership threshold that triggers reporting. The final rule wasn't out as of September 2026.

FinCEN reporting on cash purchases

FinCEN's residential real estate reporting rule, which would have required reports on many all-cash purchases by entities and trusts, was vacated nationwide by a federal court in Texas on March 19, 2026. The government appealed. As of September 2026, FinCEN says it isn't being enforced, but watch for the appeal.

Company ownership reporting

After an August 2026 final rule, US-formed companies no longer have to file beneficial ownership reports under the Corporate Transparency Act. Foreign-formed companies that register to do business in a US state still do.

What funds and sponsors with foreign investors should check

If you run a fund or syndication with limited partners from overseas and you're buying in Indiana, the "controlling person" test is the one to study. A minority foreign investor with board seats or management influence can raise questions even without 51% ownership. Build investor diligence into your process, add representations about prohibited-person status to your purchase and operating agreements, and re-check when ownership changes. Our guide for funds and institutional buyers covers portfolio acquisitions here.

Frequently asked questions

Can foreign citizens buy a rental property in Louisville, Kentucky?

Generally yes. Kentucky has no general ban on foreign ownership of residential or commercial property. Its 2025 law applies to agricultural land, and only to buyers tied to, or taking direction from, the government of a country on the federal proscribed-countries list.

Does Kentucky's law cover houses, apartments and commercial buildings?

No. Kentucky's House Bill 315 is limited to agricultural land. Get legal advice if you're buying farmland or a large rural tract.

Does Indiana's law apply to citizens or residents of a designated foreign adversary country?

Generally yes, as of July 1, 2026, for all real property in Indiana, unless an exception applies, such as being a US citizen (including a dual citizen), green card holder or asylee, or holding a qualifying long-term visa and buying a single-family home of half an acre or less. An attorney, not a real estate agent, should decide whether the law applies to you.

What if I already own property in Indiana?

People who owned before July 1, 2026 can generally keep it unless the state proves they're acting as an agent of a foreign adversary.

Does this affect renting?

Under Indiana's law, prohibited persons can still lease residential property for up to 24 months.

Get the right answer before you make an offer

Every buyer's situation is different, and we're not your lawyer. What we do is ask the right questions early and bring in an attorney before you make an offer. Whether a law applies to you is the attorney's call, not ours. Start on our international investor intake form or book a call with Rob.

More guides for out-of-state and international investors

• The out-of-state investor playbook for Louisville
• California investors buying in Kentucky
• Texas investors buying in Kentucky and Indiana
• International investors buying in Kentucky and Indiana
• FIRPTA and US taxes for foreign investors
• LLCs and banking for out-of-state and foreign investors
• Closing remotely: wires, notarization and time zones
• Loans for out-of-state and foreign national investors
• Building your remote investor team in Louisville
• Funds and institutional buyers acquiring here

Winner Realty is a real estate brokerage licensed in Kentucky and Indiana. We're not attorneys, and this is general information, not legal advice. Sources: Kentucky House Bill 315 (2025); Indiana Senate Enrolled Act 256 (2026) and House Enrolled Act 1183 (2024); 31 CFR Part 802; FinCEN; USDA. Laws change. Confirm the current rules with an attorney before buying.