Hidden Costs in Real Estate Real Estate

Buying your first home is an exciting milestone—whether it’s about achieving financial independence or finally owning a space you can call your own. But for many first-time buyers in India, this excitement is often tempered by unexpected costs that show up well after the purchase decision is made.

At Urvik Consulting, we believe that an informed buyer is an empowered buyer. So here’s a breakdown of the most common hidden costs in real estate that first-time homebuyers should plan for—before signing on the dotted line.

1. Stamp Duty & Registration Charges

These are mandatory fees charged by the government for property registration.

  • Stamp Duty: 5% to 7% of the property value (state-dependent)
  • Registration Fees: Around 1% of the property value

2. GST on Under-Construction Properties

GST applies only to under-construction properties:

  • 5% GST for standard homes
  • 1% GST for affordable housing

No GST is applicable on ready-to-move-in properties.

3. Brokerage & Consultant Fees

While some deals are brokerage-free, many involve charges of 1%–2% of the property cost.

Legal vetting of documents (title deed, encumbrance, RERA status, etc.) can cost ₹5,000 to ₹25,000, depending on complexity.

👉 Don’t skip legal due diligence—it’s the best insurance against future disputes.

5. Home Loan Processing Charges

Banks charge 0.25% to 1% of the loan amount as a processing fee. Some also add technical and legal verification charges.

Always read your loan agreement carefully and compare offers from multiple lenders.

6. Society Deposits & Maintenance

New societies often charge:

  • Corpus fund
  • Clubhouse fee
  • Elevator & common area charges

These can add up to ₹50,000 or more.

7. Parking Charges

Parking is often sold separately—especially in metro cities.

  • Cost: ₹2 to ₹10 lakhs

👉 Clarify parking allotment and charges during negotiations.

8. Interior Setup & Furnishing Costs

Most homes are handed over without essentials like:

  • Modular kitchens
  • Wardrobes
  • Electrical fixtures

Expect to spend 5%–10% of the property price on interiors.

9. Annual Property Tax

Payable yearly to the local municipal body.

  • Typical Range: ₹1,000 to ₹20,000

This cost varies based on your city and property type.

10. Relocation & Shifting Expenses

Don’t forget moving costs:

  • Packers & movers
  • Labor charges
  • Travel costs

These can run into thousands of rupees, especially for intercity moves.

11. Utility Connection Charges

You may need to pay for new connections or deposits for:

  • Electricity
  • Water
  • Gas pipeline
  • Internet/DTH

👉 In some areas, “unofficial charges” may be involved—plan accordingly.

12. Delayed Possession Costs

If you’re renting while waiting for your new home, EMIs + rent can create a financial burden.

👉 Always verify the developer’s RERA registration and past track record.

How to Avoid Hidden Costs in Real Estate

  • Request a full cost sheet from your builder or seller.
  • Hire a real estate lawyer for legal vetting.
  • Choose RERA-registered projects for better transparency.
  • Keep a 10%–15% buffer in your budget to absorb surprises.

Why Staying Informed Matters

Most first-time buyers focus only on the sale price, down payment, and loan EMI. But hidden costs can increase your total outlay by 10% to 20%—if not more.

With expert guidance from Urvik Consulting, you can make smarter decisions, avoid financial shocks, and plan confidently for your future.

Final Thoughts

Buying your first home is a rewarding experience—but preparation is key. Hidden costs in real estate are real, and they can catch even the smartest buyer off guard.

At Urvik Consulting, we’re committed to full transparency and buyer empowerment. Whether you’re looking for investment advice or help navigating paperwork, our consultants are here to guide you—every step of the way.