Welcome to our blogging space! It’s been a while the new year has set in and as a home buyer, you must be in an exciting phase to book a dream home of your own. Right? But, prior to proceeding with the tedious process of documentation and booking, what’s more significant is taking care of the mounting costs.
Are you really aware whilst you’re ready to take over in your new abode, what are disparate expenses you need to incur? Fret not, here we’ve compiled the top 5 lists of hidden costs associated with the home buying process.
Stamp duty and registration of title:
Stamp duty is just like sales tax and represents a legal evidence of property investment. As per the Section 3 of The Bombay Stamp Act, 1958, the transactions made for the stamp duty is recorded by the government of India. The cost of stamp duty varies from state to state.
When a home or a property is registered in your name, registration fee is imposed. The amount of registration fees is more than the fees of stamp duty. Most of the times, it is 1% of the market value.
The cost of maintenance varies depending on the type of home you have chosen. Maintenance deposit is in a way saving for the home buying process. It is usually deposited for the purpose of maintaining common amenities, lobbies, landscaping, pools and elevators.
For buying a home, if you’ve consulted Realtor or a property agent then you will have to incur around 1-2% of the property cost. This is basically a service charge as agents serve as mediator between buyer and seller.
Service and VA tax:
While stamp duty is somewhat similar to the tax, another hidden cost associated with the home buying process is service and value added tax. This amount is basically directed towards government. The taxes are levied only for properties that are bracketed as under construction. In case of independent homes, villas and bungalows, service tax is exempted, as well as not applicable for homes with a carpet area of 60 sq ft. In case of service and VAT, the money is usually paid by the builder, although it is often recovered from the buyers.
Expenditure on interiors:
When you’re buying a home, the cost of interiors is unavoidable. Interiors mostly include furniture, painting, electrical fittings, plumbing, among others. Most of the times, the cost incurred on interiors can go up to lakhs.