Buying a luxurious apartment in India’s real estate market involves a complex web of costs, legalities and formalities that must be fulfilled. Right from due diligence on property rights and ownership to delving deeper into tax implications and agreements, every step in the procedure comes with potential risks and returns.
If you’re looking for a luxurious apartment in India, it’s important to be aware of the hidden costs that can accumulate, potentially making the purchase a costly affair.
Understanding Luxury Apartments
Luxury apartments are a diverse combination of several aspects, such as high-quality amenities, residential living, premium-quality designs and structures, and prime locations, hence they tend to blend the pinnacle of all of these. Such spacious apartments offer privacy, comfort and status to those living in the fascinating residential buildings in some prestigious areas.
Several buyers prioritise living in apartments having environment-friendly designs, energy-saving and efficient systems and other health and wellness characteristics. In the present era, luxury apartments have become dynamic and are constantly evolving to cater to all-inclusive lifestyle choices for potential customers.
Read Also: Understanding the Legalities of Buying a Luxury Property: Essential Insights
Main Hidden Costs to Consider While Purchasing a Luxury Apartment
Purchasing an apartment can seem like an overwhelming journey, filled with dreams and the expectation of starting fresh. However, knowing about the hidden fees can let you plan things effectively and go through the entire process effectively.
- Brokerage:
According to RERA guidelines, homebuyers can verify the credibility of the realtor to ensure authenticity. If you’re purchasing a luxury apartment through a brokerage firm or realtor, it is important to check whether the individual or company is registered with RERA (Real Estate Regulatory Authority).
Brokerage fees can vary depending on the location, but the standard industry rate is typically around 2%. This fee is usually shared equally between the builder and the realtor, with both the buyer and the builder contributing to the payment.
- Stamp Duty:
Stamp Duty is a compulsory fee that a buyer pays to the state government while purchasing a property. It is required to facilitate the registration of the property; without payment, the property cannot be registered.
The duty is charged on the market value or current agreement value, whichever is more. Normally, it differs from 3% to 7% as per the state. Factors like property location, total cost, etc., determine the payable stamp duty charges. However, the stamp duty for women buyers is on the lower side in states like Maharashtra.
- Surcharge:
Along with the stamp duty, an additional cess of 10% and a surcharge of 2% is to be paid for property value of more than Rs.35 lakhs in urban areas. However, the specific rates would vary by state or local laws, and not all states follow the same structure.
- Registration Fee:
The official procedure that legally documents the buyer’s acquisition of property from the seller (or builder) is known as registration. Since it certifies the buyer’s legal possession of the property in official records, this procedure is crucial.
To get this important legal document, you need to pay the registration charges to the local sub-registrar’s office which is 1% of the total property value in Maharashtra.
- Property Inspection Charges:
These charges are incurred by a bank on inspecting the property to calculate its worth and existence. Also, the bank investigates the developer’s past track record of project completion. However, if you are an old customer, this fee may be waived.
- Maintenance Charge/ Society Security Deposit:
This charge varies between societies and is typically set by the Apartment Owners Association (AOA) or the society itself, which collectively determines the rate. It helps buyers estimate the additional expenses they must account for when purchasing a property. These charges often cover costs for security personnel, road maintenance within the community, lighting, and other communal facilities.
Final Thoughts
Buying an apartment in India is much more than the listed prices; it includes various legal fees that may affect your budget. Hence, it becomes essential to stay informed about these extra costs – like brokerages, maintenance charges, and stamp duty, to name a few, which may be overlooked when the initial curiosity and excitement levels are at their peak while purchasing an apartment.
Are you looking to purchase a luxury apartment? Explore a wide range of premium residential apartments with Rustomjee and get the privilege of owning a luxurious home to lead a happier and more fulfilling life at the best prices.
Read Also: Choosing the Right Luxury Property for Your Investment Portfolio
FAQs
- How to budget for unexpected expenses?
Unforeseen expenses can be budgeted with proper planning and diligence by creating a contingency fund, adjusting your budget to meet your needs, recording expenses, and practising cost-cutting. Also, being financially insured and tracking expenses can help.
- Are luxury apartments a good long-term investment?
Yes, buying luxurious apartments can be a good investment in the long run because of their solid appreciation potential, great rental yields, long-term security and having residencies in prime locations full of accessibility and quality.
- What are the key factors to consider before buying a luxury apartment?
Some main factors that can be considered before buying a luxury apartment include location, security, lifestyle, neighbourhood, carpet area, connectivity, market conditions, legal aspects, developer’s goodwill, etc.
- What are the tips for finding a real estate agent specialising in luxury properties?
While searching for the right real estate agent that caters to your needs and demands in the best possible manner, you can consider various aspects relating to it, such as reviews and referrals about the agent’s reputation and the estate’s marketing skills which include handling personalised websites and making professional photos and videos. Lastly, testimonials can be taken into consideration too.
