May 22, 2014

Trim Budget for Affordable Property Deal

Since the property prices have been continuously soaring high, property buyers need to update themselves with the additional charges that make the deal more expensive than their affordable  budget. If, flat is costing very  high, budget can be reduced smartly by keeping yourself aware of additional prices/fee/taxes. Usually, buyers don’t have exact insight into such additional costs that make property price unaffordable. Detailed information regarding such charges has been involved herein to help property seekers finalize a perfect deal that fits in their budget, the best. 

Affordable Property Deal
Direct Deal with Developer

Contacting a broker for the property deal can make back cost unaffordable . Dealing through broker put  additional burden of a certain amount or fee on the buyer. You will have to pay some amount  to the broker apart from total cost of the property. To deal with such problems smartly, contact the builder and get your deal finalized.

Loan Processing

If you are seeking home loan sanction from any bank to bear basic cost of property, contact direct through the bank , not any consultant or broker . Taking help of consultant broker puts extra burden of  fee or charge on buyer. Developers also help their customers in loan processing formalities by offering them complete information of the loan application.   

Under Construction Property

If you are dealing in an immovable under construction property, you should be aware of government order in which such property attracts a service tax. The government levies 10.3% on 25% service tax of the gross value of an immovable under construction property . Developers generally add this amount in the total cost of property or loan value as well.  

Budget for Affordable Property
Preferential location charges (PLCs)

Depending on the size, alignment, and rate of the flat; Preferential Location Charge (PLC) is imposed. This charge is not mandatory, as you can chose the location and size of flat according to your specific requirement.  If you buy large size flat or apartment, which comprises parks, parking area, lift, yoga center, etc; you will have to bear higher PLCs. 

Government Imposed Mandatory Charges

There are some mandatory charges imposed by the government like External Development Charge, and Stamp Duty & Registration Fee. 

External Development Charge

For external development and maintenance of infrastructure around the built-up or to be built-up project, government imposes mandatory charges. This external development charge is applied on per square feet basis depending on the location of project. Developer includes this additional cost in the total price of project, which is borne by the buyer. External Development or Maintenance may include the following:

•    Water supply
•    Storm water drainage
•    Sewerage
•    Roads
•    Community buildings
•    Street lighting
•    Horticulture
•    Public health maintenance
•    Road maintenance
•    Street lighting maintenance. 

Stamp Duty & Registration

Stamp duty is a mandatory fee, which is paid to the state government. This fee is paid, when you register your property in your name at the time of possession. Registration is also mandatory in case you get property as gift from someone. This fee is calculated on the current market price of particular property, which is lower for women.

What to Confirm Before Deal?

In order to escape from the unnecessary costs that should have been borne by the previous owner of the property, you need to confirm the following:

•    Pending Property Tax
•    Pending Water Tax
•    Pending Electricity Bills, etc.

If, the previous owner has not paid all of above mentioned charges; you will have to bear extra burden of payment. It is better to enquire first and then finalize your deal.