10 Hidden Charges while buying a property in India

10 Hidden Charges while buying a property in India

Buying a house is a dream for many people, and when that dream is realized, our excitement is uncontrollable. You do everything right; choose the location, set the budget, and prepare for the housewarming, but when moving day finally arrives, you’ll be greeted by a whole bunch of hidden costs that will completely overshoot your expenses. These costs are not hidden per-se, they are quite forgettable in the excitement you have when buying a home. Before you go for the big purchase, make sure you set your budget to cover up these 10 hidden costs.

Home inspection cost

  • When applying for a home loan, apart from doing a background check to calculate your loan eligibility, banks will hire 3rd party home inspectors to check if the proposed property value is worth its price tag.
  • No matter the final report on the property’s condition, the payment for these inspection services will be billed to you and may be added to the monthly interest on your loan.

Cost of relocation

  • The task of getting all your home decor and furniture from the old place to the new is made easier with relocation or moving services.
  • Then again, they don’t come cheap, so better be prepared with the money in hand when you approach a relocation service or plan ahead when setting up your budget for buying a home.

Maintenance deposits

  • Builders today are asking for maintenance deposits up to 2 to 10 years in advance, as it gives them a greater capital amount to work with.
  • Maintenance charges are subject to the locality, land value, and type of home you are hoping to purchase. They can also vary depending on the quality and number of amenities the builder is offering you.
  • This hidden cost adds up a lot of your budget, so make sure you’re prepared well in advance.

Stamp Duty/Registration fee

  • Stamp duty/Registration Fee is a compulsory fee that must be paid to the Government whenever you are about to register for a property under your name. 
  • This registration is done to achieve a validity to the agreement/ Sale Deed between the buyer and seller confirming a change in ownership.
  • As always, keep your budget fixed well in advance for this fee, as it is likely to cost a lot when you are buying an expensive.

Parking space cost

  • Parking space is a handy amenity to have in apartments but then again it is not an amenity that is given to you outright, you have to pay the builders an additional cost to claim your parking space, which may vary depending on how many spaces you require and is directly proportional to the value of the area you are going to live in.

Value Added Tax (VAT)

  • Taxes is something no one can avoid. When buying a real estate property, VAT is payable to the Government and amounts to 3.09 percent of the property value in Tamilnadu.
  • For those looking to purchase apartments on a budget more than Rs. 1 Crore or above 2000 sq feet, the VAT is 3.71 percent and this is something that cannot be avoided. So please do make sure you check with the developer if the price quoted includes the VAT amount.
  • Additionally, you will also have to take into account any new tax reforms in the real estate sector. If there is an elevated tax mandate, your cost might go up.

Interiors cost

  • Fully furnished apartments save you time in deciding how to set the looks and basic interiors for your living space, but they also come with a price.
  • Basic things like plumbing, painting, and laying tiles can vary in cost depending on how exquisite you want your home to look.

Preferential Locality Charge (PLC)

  • Apartments consist of various blocks, each providing their ways of life to residents. Here, you are forced to balance the budget again with additional costs on the PLC varying from builder to builder.
  • High rise apartments generally cost more when you opt for luxury homes and penthouses.

Realtor’s fee

  • If you bought a house through a real estate broker, you have to pay the broker some amount of commission. The charges can vary from depending on the value of the property and the realtor’s personal fee.
  • Online brokers charge a lot less and give you more options, but it’s better to be safe than sorry and check your budget if it covers for the realtor.
  • So, if you are buying a house with the help of a broker, then 1-2% of the property value has to be paid as brokerage. This price isn’t fixed though.
  • The above-mentioned home charges are unavoidable, but if you have planned everything right and set a strong budget, you can truly live a dream at your new home.

Miscellaneous charges

  • Other costs that you probably won’t be prepared for when you are saving up to buy a property are the moving charges. When you move to a new house, you will have to pay the movers and packers a reasonable chunk of money.


Buying a property is undeniably something to be proud of. For many, buying a house translates to achieving a huge milestone in their lives. But it does come with its own risk factors, concealed costs, and terms and conditions. Taking a leap without knowing the entire process can throw you into a tizzy. Homeownership is an exciting feeling. When you get down to the brass tacks of buying a property and plan your savings accordingly, you might avoid unwanted confusion and headaches later on.

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