A ₹50 lakh flat does not mean a ₹50 lakh expense; don't forget these 6 hidden charges

New Delhi (The Uttam Hindu): Buying a home is one of the biggest financial investments in a person's life. While buyers generally calculate the property's base price and home loan EMI, they often overlook several additional costs associated with the purchase. As a result, expenses that emerge at the time of possession or registration can disrupt their financial plans. The final cost of a flat can be significantly higher than its advertised base price, making it important to account for all associated charges before finalising a purchase.

1. Stamp duty and registration charges: The biggest additional expense

After the property's base price, stamp duty and registration charges are among the biggest expenses involved in buying a home. The rates vary across states and cities and can generally range from around 5% to 8% or more, depending on local rules. Some states also offer concessions to women buyers.

For example, on a ₹50 lakh property, a buyer may have to pay several lakh rupees towards stamp duty and registration. Therefore, making a decision based only on the property's base price can lead to an inaccurate estimate of the total cost.

2. GST on under-construction flats, while ready-to-move-in homes get relief

If you are buying a flat in an under-construction project, GST can have a direct impact on the overall budget. Under the current tax structure, effective GST is generally 5% for non-affordable residential properties and 1% for affordable housing.

In contrast, GST is generally not charged on the sale of a completed property where the completion certificate has been issued before the sale. Therefore, buyers should check the project's legal and completion status before booking a property.

3. Parking, advance maintenance and corpus fund can add significantly to the cost

Apart from the flat's basic price, developers may charge buyers separately for dedicated car parking, advance maintenance, club membership and corpus or sinking funds. Depending on the project, these charges can add several lakh rupees to the purchase cost.

After possession, residents also have to pay regular maintenance charges for common facilities such as lifts, security, power backup and cleaning. Buyers should therefore ask the developer for a written, itemised breakdown of the complete cost.

4. TDS rules for property purchases of ₹50 lakh or more

Under the Income Tax Act, when a resident buyer purchases an immovable property valued at ₹50 lakh or more, the buyer is generally required to deduct 1% TDS from the amount payable to the seller and deposit it with the government.

This is not an additional cost over and above the property's purchase price because the amount is deducted from the payment due to the seller. However, buyers need to account for the requirement while managing their payment schedule and ensuring proper legal compliance.

5. Legal scrutiny, loan processing and brokerage costs

Legal due diligence is particularly important when buying a resale or older property. Buyers may need to pay a lawyer to verify the title deed, ownership history, approved building plans, NOCs and outstanding liabilities.

Other possible expenses include home-loan processing fees, property valuation charges, agreement-drafting fees and, in some transactions, brokerage paid to a property agent. These costs should be factored into the overall purchase budget.

6. A ₹50 lakh flat can require a total budget of ₹60 lakh or more

If a buyer chooses a flat priced at ₹50 lakh, it does not necessarily mean that ₹50 lakh is the total amount required. Stamp duty, registration, applicable GST, parking, corpus fund, loan-related charges and interior expenses can significantly increase the overall cost.

Depending on the state, project and individual requirements, the total outlay can reach ₹58–60 lakh or more. Buyers should therefore obtain a complete written “all-in cost” statement from the developer or seller before signing the agreement.