Typical hidden costs involved while buying a home.  Stamp duty: Stamp duty is the tax that is paid on the documents. Traditionally, you need to affix a physical stamp, a tax stamp on every document to make it valid. It gives you the legal right to the property you are buying. As the price of the property goes up, so does the stamp duty. As Mumbai has one of the highest realty prices in the country, the stamp duty here is the highest than in any other part of India. Maintenance: When you buy a flat, you will be using facilities provided by your building like lift, car park and gym. Your building may also provide you with security, intercom system etc. You will need bear your share of the total costs involved and will be billed to you as maintenance and you end up paying them. | |
| | Electricity and water charges: You must bear these charges as you definitely will need water and electricity once you move to your new home. Home insurance: Very few people will be able to buy their own home by paying full price of the home in cash upfront. Most of them will end up taking a loan to pay for the price of the home. But when taking a loan, the lender will make it mandatory for you to take a home insurance to protect their money in case if your home is damaged due to any unforeseen events. |
Cost of furnishing the home: Some builders offer fully furnished flat and will include the cost for the same in the price of the home. If it is not furnished, you will have to bear the cost of furnishings and fittings. Property tax: This tax is charged by your local municipal body on the property that you have purchased. This tax goes towards maintenance of the civic services in your city. Dealing with these hidden expenses: While certain expenses like property tax and stamp duty cannot be reduced as they are fixed by the government, other expenses can be curtailed to some extent. To reduce maintenance costs, buy a resale home instead of a new home, as flats in old buildings have lower maintenance charges than those in the new buildings. Search for home insurance policy offering the lowest premium rate. You can opt for an unfurnished home and then get it furnished as per your budget and taste. It will let you bargain for the rates and will let you get the best possible deal. Buying a home is quite an expensive process. It includes the various costs mentioned above like stamp duty, property tax, maintenance, electricity and water expenses, furnishing expenses etc. It is important you take into account all these costs before buying your home as it can make a significant increase in the final price of home. If you are unaware of any costs, or need help, talk to a reputed broker for advice. By BankBazaar.com - an online marketplace for your personal loan and home loan needs. | |