Buying a house? Here are additional costs you need to pay
Here's a primer on additional costs a builder will ask for before he hands over the possession of the property to you
Buying a house is a financial as well as an emotional decision. It is at the same time a very expensive investment needing you to park your life savings. However, a hurried decision at the time of buying can cost you dearly if you do not think through the whole process. Apart from the BSP or the base cost per sq ft of the property, there are many additional costs that you need to shell out before taking possession of the property. Hence, if you are buying a property here is a primer on what additional costs your builder will ask before handing over the possession of the property:
Registration cost: Once you get possession of the property you need to pay the registration cost of the property. It is a cost charged by the state government for registering the property in your name. The registration cost varies from state to state, according to rough estimates it can be anything from 2-6% of the property cost.
GST: Previously taxes like VAT, service tax, etc were paid by the buyers at the time of purchasing a house. However, now, a uniform GST rate is paid at 5% on residential properties and 1% for the affordable housing segment. No GST is applicable on completed or ready to sale properties if the completion certificate has been issued.
Possession charges: The buyer also needs to pay possession charges before the keys are handed over by the developer. Once the demand letter is received for the possession of the property then the buyer has to make the payment for the remaining due amount to the developer.
Home loan processing fees: For buying the house you need to pay around 20% of the cost as a down payment while the rest can be funded through a home loan. For getting the loan approved you have to submit the application to a home loan provider which will charge the fee of around Rs 5000-Rs 10,000 as processing fees. These are non-refundable charges in case your application gets rejected or you choose to go with some other lender.
Interior Cost: Once you get possession of the house you need to spend on interiors such as doors, fittings and furniture, among other things.
Hence, to make the house livable you might need to spend a lot more money than what you initially accounted for.