US citizen should come down personally to execute sale deed 

2) if he is unable to come down to India he should execute specific POA in favour of close family relative to execute sale deed .

3) POA should be attested before Indian consulate 

4) TDS should be deducted at around 23 per cent 

5) there should be indemnity clause in sale deed to indemnify you in case of third party claims 

6) time should be essence of contract 

• The sale proceeds are credited to NRO account and remittance from NRO account is allowed up to USD One million in a financial year after payment of tax.

 Irrespective of the value of the property, since the seller is an NRI, the deduction towards the Income Tax TDS amount would be around 23%, which has to be deducted by the buyer out of the sale consideration amount and then only the remaining amount has to be paid to the NRI seller. The proceeds have to be deposited in NRO account of the seller. The clauses in the agreement of sale should be carefully drafted, which should include breach of contract, time for completion, etc.

As per the Master Circular No. 4/2013-14 by RBI, a PIO can transfer any immovable property in India by way of sale to any person resident of India. 

You need to take following  general prcaurtions.

1. Verify the title of the seller.
2. Personal inspection of property under sale (site/building/flat/agricultural land):-
3. Check the original documents.
4. Tax receipt and bills.
5. Encumbrance certificate.
6. Place a public notice.

you need to transfer sale consideration in to his Indian account. For transferring it, he has to obtain RBI permission. You need to deduct TDS  on sale price. A reputable citizen from each side can sign sale deed as attesting witness. 

The only precaution you can additionally take is to make TDS towards the payment of sale consideration amount.

You can remit the amount to the account what he may provide whether resident account or NRO account 

NRIs can repatriate the proceeds from the sale of a residential property in India, provided they meet a few conditions

The immovable property should have been acquired by the seller in accordance with the provisions of the foreign exchange law in force at the time of acquisition

In most aspects, a sale deed executed by an NRI seller is similar to a sale deed executed by an Indian seller.

If the purchaser is Indian, payment by the purchaser to the seller will be by way of foreign remittance. FEMA guidelines will have to be referred to, to ascertain the manner in which the sale consideration can be transferred by the Indian purchaser to the NRI seller.

For an NRI, the capital gains on sale of immovable property would be taxable in India. Such tax payable would depend on the period of holding of the immovable property – a. If the property has been held by the NRI for more than 24 months immediately preceding the date of sale, the property is considered a long term capital asset in the hands of the seller, and taxable at 20% plus applicable surcharge and cess.

The agreement needs to be examined to render proper advice. In any case, as he is a US citizen, he may take undue advantage by evading any legal action in India which you may initiate against him in future.

You can do all of above there is no bar

You should get the sale deed drafted or vetted by some experienced lawyer 

In case of any dispute, you can bring him to court irrespective in his citizenship.

Presence of 2 witnesses for execution of sale deed is a must for valid execution of the sale deed.

You should transfer the money in his Indian/ NRO account as the said transactions can be easily proved before the court in case of any dispute.