Understanding The Costs Involved In Buying A Home
Excited about settling into your dream apartment? Well, this isn't something you do overnight. It takes years of savings to make this dream come true one day. And when the day finally comes, there are still so many things to be worried about, besides excitement.
It is crucial to be well-informed, as a few mistakes can lead to bigger mistakes and losses. Talking about this, one must always evaluate the potential costs involved before buying a home. Wondering what those are? Well, to help you, here is the ultimate guide for a hassle-free buying experience.
Hidden Costs You Should Consider Before Buying a Home
When you buy a home, you start a new chapter of your life. To make sure every next day is peaceful and joyous, here are some hidden costs you should consider beforehand:
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Registration
Imposed by the government, every homeowner must update property ownership records. To register the property in the buyer's name, registration is an additional obligatory fee at the time of purchase.
It is 1% of the home's worth in the majority of states. So, are you ready to buy a home for your new family? Take into account the registration, which is completed in the jurisdiction where the property is located.
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Stamp Duty
Stamp duty is a mandatory charge imposed by the government on real estate transactions. It serves as proof of a property sale or purchase while authenticating the transaction agreement.
The stamp duty fees vary from state to state and may range from 4% to 7% of the property value. In some states, they also offer up to 1% in rebates for women homeowners and those purchasing inexpensive homes.
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Processing Fees
Are you planning to finance your purchase with a house loan? Banks and other financial institutions may charge a processing fee in such a case.
This fee, which is often a percentage of the loan amount, supports the administrative expenses of processing your loan application.
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GST
Are you buying a property that is still under development? This may seem to you like a hidden cost, but you will be responsible for paying GST. For properties that qualify as affordable housing, the GST is computed at 1% of the home's value.
A home that is less than Rs 45 lakh in value and less than 60 square meters in metro areas and 90 square meters elsewhere is considered an affordable property. If not, 5% of the property value will be charged in GST.
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Parking Reservation Expense
Many homeowners believe they won't have to pay parking fees for their cars. However, this isn't true because parking fees are imposed by housing societies or the builders for designated parking spaces. Do you have more than one car?
Well, then you might need to invest more to purchase more parking spaces. Also, depending on the community, the parking fees could range from thousands to lakhs of rupees and could be assessed as annual or one-time parking fees.
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Floor Number
Another thing that affects the cost of buying a flat or apartment in India is the floor level. You may have to pay an additional fee if you choose the upper levels. The cost of a floor raise depends on the specific floor you choose. Floor rise charges are frequently included in the agreement value.
However, they may vary by builder and could not even be a separate component. Floor rise rates are typically expressed in square feet and may be set by the builder for a particular group of slab floors or each level. Before buying, make sure to have a clear discussion with your builder.
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Brokerage Fees
When it comes to purchasing your dream home, it starts with thorough research. While some people search all by themselves, others hire brokers to find the best deals and properties. This is another cost that is involved in buying a home.
So be ready to pay a broking charge if you have hired a real estate agent or broker to assist you in finding your ideal house. This is often calculated as a percentage of the property's value and is paid when the deal is completed successfully.
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Maintenance Deposit
The cost involved in buying a home can be greatly impacted by property maintenance fees. Maintenance charges usually include:
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Common water
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Electric charges
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Building security fees
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Lift fees
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Property maintenance fees
Builders may collect these upfront for a 1 or 2, and the total might reach lakhs. Depending on the size and location of the house and apartment complex, things may vary.
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Locality Charge
Another cost involved in buying a home is the locality charge. The cost of your ideal home might be greatly influenced by this. You may also have to pay an additional premium for some properties that may have :
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Superior amenities
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Better connectivity
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Proximity to necessary facilities.
Therefore, when purchasing a home, make sure you take the location into account.
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Property Insurance
You might also consider purchasing home or property insurance. There are several options, including burglary insurance, fire insurance and all-risk insurance, these days.
They cover the structures of your house and emergencies. This means, having insurance means protecting your money and possessions.
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Interior Design
If you purchase any home without an inspection, then the interior may come as a hidden cost. Personalising or renovating your space may cost extra.
This may include the walls, furniture and décor of your house. During the planning phase, take the cost of painting, plumbing, furnishings, upholstery, appliances, etc, into account.
Enter Your Home With a Cheer
Are you ready to buy a home? We at City Prop are the leading real estate company. We offer top-notch solutions to home buyers, whether you are in search of villas, apartments or houses.
Our professionals are highly knowledgeable and have deep insights into the market. From pursuit to possession, we guarantee to stay by your side. With us, buying a home doesn't have to feel like a daunting task anymore. For more, you can contact us anytime.