Buying a new home is a proud feeling for every individual. It is like a dream come true where our excitement knows no bounds. But, we think of price of the house as the only cost, but is it the only instance where we have to shell out money? Well, the answer is a straightforward no. Several hidden costs are there which can increase our expenses later on. The fact is that being the new home owner, either we ignore these costs or sometimes we even don’t know about them. These hidden costs are nicely coated up with the price of flats in Pune or Bangalore or any other city and the buyers end up shelling a lot more money than their actual expectation. Below, we have mentioned 7 hidden costs that you should not ignore when purchasing the new home.
Stamp Duty and Registration Fee
If you’ve ever engaged in the house buying process then you must know that stamp duty is the compulsory fee that the buyer has to pay to the state government so as to get the house registered. This cost varies from one state to another but you have to pay this cost otherwise your house won’t be registered in your name. Maybe this seems a small amount at the time of payment but later on it sums up with other hidden costs and leaves the buyer disappointed at the end of the house buying process. Flats are already expensive and such costs just add more expenses to the same and increase the head-ache of the buyer.
Home Inspection Cost
Home inspection is yet another hidden cost that the buyer has to pay to the 3rd party sent by the bank before sanctioning a loan. This 3rd party basically checks if the proposed property is worth its price tag and it is good to know that no matter what, the payment for these inspections will be billed to the buyer or may be added to the monthly interest of your loan.
Maintenance cost is subject to locality, type of home and land value. Builders usually charge this cost for up to 2 years in advance. The amount varies from society to society but ends up adding to the expenses of your planned budget.
Cost of relocation
Another hidden cost that we have to encounter with is relocation cost. This cost is charged by those who offer relocation services while shifting to the new home. Relocation simply means moving our décor and furniture from old to new home and that also don’t come at the cheap rates.
Parking space charges
Now if we live in any society then it is quite obvious that we have to pay parking space charges for the same. Parking space is a handy amenity and for this we have to pay additional cost to the builders. It basically depends on how much area you live in and availability of the parking space. Like other hidden costs, it also seems small but definitely ends up in increasing your planned budget.
The broker is a middleman between the buyer and seller. Finding house is not that easy and you need to hire a broker who can do this work for you and it is quite obvious that he’ll charge his fee after the deal is done. Now, this cost is actually not hidden as you already know that you have to pay the broker fee. However, the amount you pay him is significant. For example, if you’re purchasing a flat in an upmarket locality which is worth Rs. 5 crore. With a, say, 1% brokerage, you will have to pay Rs. 5 lakhs.
Goods and Services Tax (GST)
This is a recent addition. It is the charge paid to the government and is something that we can never avoid as it is a compulsory fee. GST seeks to remove the dual taxation in the form of value-added tax (VAT) & service tax. At the time of writing this article, GST rate of 12 percent is applicable on properties that are under-construction.