Investing in property is a significant decision. You know you have sweat, earned and saved for buying a dream home. You would not want any of your hard earned money to be spent in any unknown expenses while investing in property. It’s quite natural that all the obvious costs are covered when you think of buying a house – affordable home prices, good housing loans, lower mortgage rates etc.
Chances are, you would have missed out on the other wallet pinches that may be involved in the process of investing in a property. On an average, while investing in real estate, people tend to reach the upper scale of their financial budget during the decision making process. Hidden costs are they are termed, are the surprise elements that often escalate the quoted price of a property. On an average it may be up to 25% add-on. You may, therefore, be taking a hit and shelling out more than you think!
If you have planned to buy ready to move apartments in Bangalore, prep up your finances before signing on the dotted line.
5 Things to keep track of while planning your expenses
- Stamp Duty and Registration Fee – If you plan to buy 3BHK completed apartments in Devanahalli, you must be aware of the costs you will be paying after paying for the property. A stamp duty is a mandatory fee that the buyer is pays to the State Government to register a property under his/ her name. These charges vary from state to state between 5% and 7% of the registered property value. A registration fee is the full and final agreement between the buyer and the seller for change of ownership. The court may charge 1-2% for this process.
- Maintenance Deposit – Builders of upcoming apartments in Devanahalli will additionally charge you an advance maintenance deposit that covers common amenities, parks and lightings. Depending on the facilities provided to you, this fee may vary.
- Brokerage Fee – This is not exactly a hidden charge but if you have a middle man taking care of your communication and the transaction between you and the buyer, you will be charged a fee by the broker. While the normal pay is usually 1-2%, it is wise to find out with the broker at the onset and settle before the buying process.
- Interiors – One often forgets that a newly bought has to be customised to one’s liveable conditions and needs. Interiors is one of the biggest and important cost that one tends to miss in to the overall financial expenditure.
- Service Tax and Value Added Tax (VAT) – Any property bought within India will attract VAT and Service Tax that are also paid to the government. The service tax is charged at 12.36% of the 25% value of the under-construction property. The VAT is calculated and charged on the construction value of the property.
Check for all expenses and get advice from consultants or property developers to understand before blindly agreeing to buying a property.