Buying a home in India

The price on the brochure is only part of what you pay. Know the other costs, the checks you can make yourself and how a loan really works before you sign.

This page is for education only. It is not investment, insurance, tax or legal advice, and it does not recommend any security, fund or policy. Saifu is not a SEBI registered investment adviser and is not an insurer, broker or insurance web aggregator, and it does not sell insurance or investments. Examples are illustrations, not promises. Mutual fund investments are subject to market risks; read all scheme related documents carefully. Past performance does not guarantee future results. Rules, rates and product terms change, so check the current policy wording or offer document. Please discuss with a qualified financial adviser before taking any decision. Property and tax rules differ by state and change often. Saifu does not list, sell or recommend any property, builder or lender.

What a home costs beyond the price

• Stamp duty and registration. These are set by each state, and often differ by city, by the buyer and by the property. Check your state registration department's own rate page or e-stamping site, not a broker's figure.
• GST. It can apply to an under-construction home, but not to a completed one with an occupancy certificate. Ask the seller in writing which applies to you.
• Loan costs. Processing fee, legal and valuation charges and sometimes insurance the lender asks for.
• Move-in costs. Society or maintenance deposit, a parking charge, interiors and the brokerage if one was used.

RERA: what to check on any project

The Real Estate (Regulation and Development) Act, 2016 made builders register larger projects with the state RERA authority. As a buyer you can check the same things on your state's RERA website, free:

1. Is the project registered, and until what date?
2. What carpet area was promised? Under the Act, a home is sold on carpet area, not on a loading-inflated super area.
3. What is the promised possession date, and what approved plans and sanctions are filed?
4. Have there been complaints or orders against the builder or the project?

The Act also requires a builder to keep most of the money collected from buyers in a separate project account, and makes the builder answerable for structural defects for five years after possession. If something goes wrong, the state RERA authority takes complaints from buyers.

How a home loan works

You pay a fixed monthly instalment (EMI). Early on, most of it is interest. Over time, more of it goes to the loan itself. A longer tenure lowers the EMI but raises the total interest, so look at the total as well as the monthly figure.

• Down payment. The RBI limits how much of the property value a lender can finance, and the cap is tighter for costlier homes. So you must pay part of the price from your own money.
• Floating rate. Most home loans from banks move with an external benchmark such as the RBI repo rate, so your EMI or your tenure can change when rates change.
• Prepayment. For floating rate loans to individuals, the RBI does not allow a prepayment or foreclosure charge. Ask for this in writing for your loan.
• Eligibility. Lenders look at income, existing EMIs and credit score. Check your credit score free before you apply, so a refusal does not add a hard enquiry.

Try your own numbers, with any amount, rate and tenure in years and months, in our EMI calculator.

Rent or buy: a worked example

This is an illustration with made-up round numbers. It is not a forecast, and it ignores house price growth, rent rises and what you could earn on the money you do not spend on a down payment. Those three things decide the answer in real life, so change them to your own case.

Buying costs more every month here, and you build ownership. Renting costs less each month and leaves ₹20,80,000 free to put elsewhere. Neither is right for everyone. It depends on how long you will stay, your job security and what the free money could earn.

Tax: what to look up

Interest and principal paid on a home loan can reduce tax in some cases, with limits, and only under certain tax regimes. Selling a property can create a capital gain, taxed by how long you held it. These rules and the section numbers changed when the Income-tax Act, 2025 replaced the 1961 Act, so read the current rules on incometax.gov.in or ask a chartered accountant. Our income tax calculator shows both regimes side by side.

Before you pay the booking amount

1. Search the project and the builder on the state RERA website.
2. Ask for the sale agreement draft and read the payment schedule, the delay penalty and the possession date.
3. Check the title: seller's ownership documents, any existing loan on the property and the approved plan.
4. Get the loan sanction in writing before you pay a large token amount.
5. Pay by cheque or bank transfer to the account named in the agreement, and keep every receipt.

Where the official information is

• Real estate regulation, central information site (links to every state authority)
• Reserve Bank of India, for the rules on housing loans
• Your state's registration and stamps department, for duty and registration rates

This page is a general guide and is checked from time to time. Rules, rates and limits change, so confirm the current position with the official source above or a qualified adviser.