Various costs for under construction properties

Q: Hey!!! i want to know the various cost involve in under construction properties.

Anuskha Chandan, Mumbai

18th August 2015

Buying property in Mumbai

edc

various cost for under construction properties

cost involve in under construction properties

buying an under construction properties in mumbai

builder cost

idc

plc

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Replies (4)

Good afternoon Shefali!!!!
Yes, the IDC varies from developer to developer and city to city, but can range anywhere between Rs 35-300/sq-ft. It is also important to know that some builders may term this charge differently and may just call it generator charge or BESCOM/BWSSB (in Bangalore) and MTNL and BSNL in Delhi/NCR or something else.

EDC:- This is an important charge as EDC plus IDC in total accounts for nearly up to 10% of the overall base per sq-ft. price.

Devesh Kumar, Ahmedabad

18th August 2015

Comment

Thank you very much all for sharing those useful information in public forum. It will really gonna a lot's of buyers in many ways.

Apart from that many builders also take upfront maintenance charges from buyers which includes maintenance deposits, security charges, and society formation charges.

Sukhpreet, Delhi-NCR

19th August 2015

Your welcome Sukhpreet,
Yes, and once the building is ready for possession and handed over to the buyer, some builders may continue to maintain the property for one year or two after which the Corpus Fund collected by each unit in the project is handed over to the new association formed. Later on, the association fixes a maintenance charge (per sq. ft.) for the project which has to be paid by the house owner either yearly, half-yearly, quarterly or even monthly, depending on the policies of the respective project.

Shefali, Gurgaon

19th August 2015

Basic Cost:- The rate per sq. ft. multiplied with the super built-up area of the unit gives the basic cost of the property. This is the main cost of the property and usually comprises about 80 per cent of the total amount that a buyer pays. This amount is paid to the builder directly at different stages as per the builder guidelines.

Parking Charges:- Parking charges usually comprise of 3-4 per cent of the total property cost. The price usually varies from Rs 2.5-3 lakh or even more depending on the size of the parking space, builder type and other multiple factors. Some builders may also provide two car parking in their luxury projects but at an additional cost.

Chintakpujara, Mumbai

18th August 2015

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Hi Chintak,
Me from Gurgaon. I am planning to buy flats for end use there. I visited the builder's office where they show me the floor plan, approval documents and the cost sheet. But i am a bit confused about the charges which they mentioned i.e EDC and IDC? Can you explain me what are those charges?

Shefali, Gurgaon

18th August 2015

Hey Shefali...
IDC:- popularly known as internal development charge, it is usually charged at per sq. ft. rate. Imposed by the government on developers, this charge is taken by the buyer and utilised for the development and maintenance of infrastructure within the project. This includes BESCOM/BWSSB/MTNL/BSNL charges, generator charges, to name a few.

EDC, which is currently levied only in few cities in India like Gurgaon and Faridabad, among others, includes maintenance of trunk infrastructure such as roads, sewerage, water and electricity supply outside the project.

Chintakpujara, Mumbai

18th August 2015

Thanks Chintak,
What is the price range of these charges? Is it vary from city to city and developer to developer?

Shefali, Gurgaon

18th August 2015

I hope that understanding these different costs will definitely go a long way in helping one in his journey of property buying. Add to this, once the property is owned by the respective buyer, he will need to understand the various property taxation costs which are to be paid on a regular basis.

Giri, Noida

19th August 2015

I agree with Vinay!!!!
There are multiple costs that need to be paid directly to the builder at various stages. These include the following: 1) Basic Cost,
2) Parking Charges,
3) Infrastructure Development Charges (IDC),
4) External Development Charges (EDC),
5) Maintenance Charges,
6) Amenities Charges,
7) Prentiarefel Location Charges (PLC),

Chintakpujara, Mumbai

18th August 2015

Comment

But as i know these all cost comes under Builder Cost. Am i right Chintak? What about Statutory and Legal Charges?

Sukhpreet, Delhi-NCR

18th August 2015

Right Sukhpreet,
Other than the builder costs, there are few charges that need to be paid to the government at the time of property registration. There are 4 main costs involved here.
1) I. Stamp Duty,
2) II. Registration charges,
3) Service Tax and
4) Value Added Tax (VAT)

Chintakpujara, Mumbai

18th August 2015

Thanks a lot Chintak.......
Can you explain about the Builder cost and how it is calculated? What are the percentage of these charges in main cost of the property?

Sukhpreet, Delhi-NCR

18th August 2015

Besides these government charges and basic cost, there may be other charges such as Khata Assessment and Legal Advisor charges which usually ranges anywhere between 0.3-0.5 % of the total property cost. Moreover, buyers who are taking a loan on their house also have to shell out the loan processing fee and documentation charges which are anywhere between Rs 7000-10000 or up to 1% of the total loan value depending on the financial institution.

Yogita Bali, Noida

19th August 2015

Hi Anushka,
If you are planning to buy an under construction property, it is important that you know the different costs that you have to pay at various stages of construction. Per square feet rate when multiplied by the total area of the property will just give you the basic cost and not the overall cost. Remember, there are multiple costs to be paid.

All these costs can be confusing and overwhelming for you. Hence, it is imperative that you clearly understand each of the costs in your property.

Sukhpreet, Delhi-NCR

18th August 2015

Comment

Right Sukhpreet!!!!!
And these overall property cost can be divided into 2 parts, one that is to be paid to the builder while the other are the statutory and legal costs. And within each of these categories itself there are several hidden costs which a buyer must pay at different stages.

Vinay Dixit, Mumbai

18th August 2015