Hidden Costs of Buying an Apartment in India

Buying an apartment is a major financial milestone for many Indians. While most buyers focus on the cost per square foot and the overall price of the flat, several hidden costs of buying an apartment can take you by surprise. These additional expenses can significantly inflate your budget if you're not prepared.

1. GST on Under-Construction Property

If you’re buying an under-construction flat, you’ll need to factor in Goods and Services Tax (GST). As per current rules:

• 5% GST is applicable on under-construction properties (without input tax credit)
  
  
• 1% GST for affordable housing under government norms
  

Ready-to-move-in flats are exempt from GST, making them more cost-effective in some cases.

Pro tip: Always ask the builder whether the price quoted includes GST or not.

2. Stamp Duty and Property Registration Charges

One of the biggest hidden costs is stamp duty and registration fees. These government levies are mandatory and vary from state to state.

• In Karnataka, stamp duty is around 5% of the property value
  
  
• Registration charges are typically 1% of the property cost

Together, these can add 6% or more to your total apartment cost.

3. Floor Rise Charges

If you're eyeing a flat on a higher floor in a high-rise apartment, you’ll likely pay floor rise charges. This cost varies by builder but usually ranges from ₹20 to ₹50 per square foot for every floor above the base level.

4. Parking Charges

Parking doesn’t always come free with your flat. Builders often charge a separate fee for:

• Basement parking
  
  
• Covered/open parking slots
  
  
• Extra parking space (if available)
  
  

This cost can range from ₹1 lakh to ₹5 lakhs depending on the city and project.

5. Maintenance Charges and Corpus Fund

You’ll also need to pay:

• Advance maintenance charges (6 months to 1 year upfront)
  
  
• Corpus fund for future repairs and upkeep
  

These can add up to ₹50,000 to ₹2 lakhs during the handover process, depending on the size of the society.

6. Legal and Documentation Charges

Although some developers offer legal assistance, you may still need to:

• Hire a lawyer to verify property papers
  
  
• Pay for sale deed drafting, notary, and agreement execution
  

Expect to shell out another ₹10,000 to ₹25,000 here.

7. Interior and Customization Costs

Most new apartments come as bare-shell units, meaning you’ll need to spend on:

• Modular kitchen
  
  
• Wardrobes
  
  
• Lighting and fixtures
  
  
• Curtains and blinds
  
  

These interior costs can easily run into several lakhs, depending on your preferences and materials used.

8. Clubhouse & Amenities Charges

Modern apartments often include clubhouses, swimming pools, gyms, and other lifestyle amenities. While these sound great on paper, they often come with:

• Clubhouse membership fees
  
  
• Usage charges
  
  
• Annual maintenance
  

These are typically billed separately and should be included in your initial budgeting.

9. Home Loan Processing Charges

For those taking a home loan, banks and NBFCs charge:

• Loan processing fees (0.25% to 1%)
  
  
• Legal and valuation charges
  
  
• Technical inspection fees
  

These may seem minor, but they do add up to ₹10,000 – ₹50,000 or more.

While the price of the flat grabs your attention, these hidden costs of buying an apartment can increase your final spend by 10% to 15% or more. It’s essential to go beyond the brochure price and factor in these expenses while planning your budget.

Use this checklist during your property visits and financial planning stage. And always ask your builder for a cost sheet breakdown to avoid last-minute surprises.