Owning your own house is a wonderful feeling. To have a home you call your own, which you have paid for and where you expect to lay down the roots of your family is a part of the great Indian dream. However, there are many hidden costs that first-time homeowners do not expect and hence find themselves unable to cope with if they are not prepared.
Here are a few of them that you will likely encounter:
1. Property taxes
India’s property tax regime is uneven and convoluted, but if you purchase property in any urban area, you are required to pay property tax on it, and that can amount to between 6 – 10% of the annual rentable value. The taxes in metro cities are quite high, as local municipal bodies come to rely more and more on them. So when buying a flat or house, check on what the annual property tax will be, and expect that it will be revised upwards every few years.
2. Moving expenses
Whether you have lived in rented accommodations or with your parents, it’s likely you have a fair number of possessions you want to take with you when you move to your new house. You might even want to take some furniture etc. with you. Movers and packers are expensive, however, and if your goods have to be carried from one city to another, the cost can be very substantial. Don’t forget to factor in the cost and set aside some money for this as well.
3. Appearance and redecoration
One of the first things anyone naturally wants to do on moving into a new house is to redecorate it. If it is an older property, painting and plastering work may be required, even otherwise, customized interior decoration is the norm. Keep in mind that all these things cost money and should be factored in to your cost of the house.
4. Home insurance
While it is not mandatory in India, it is still a good idea to have fire and theft insurance at the very least. This is a recurring annual cost you will have to incur once you are a homeowner that you would not have bothered much about as a tenant.
5. Cable and internet
Once you move into a new place, you need to get all your ‘things’ up and running. And while we don’t use landlines much any more, we do have to spend for a cable tv connection and a home internet connection. Not to mention that these are one-time and recurring costs both (installation and rental).
6. Cleaning
As you will realise once you live in your own house, the larger it is, the more of a chore cleaning is. Even if you have a maid to do the work for you, thorough cleaning Is still something that invariably falls to the homeowner. The cost of getting this done, whether by paying extra to the maid or hiring specialist cleaning services can run to several thousand a year.
7. Pest control
Termites. Ants. Mosquitos. Cockroaches. Rats. All these are your not-so-friendly uninvited houseguests. The only way to get rid of them – and keep them away – is to hire a pest control service. As a tenant, this responsibility falls to the landlord, but when you own the house, it’s all on you.
8. Maintaining the exteriors
If you have a house with a lawn, you will want to make sure it looks beautiful, or at least presentable. Unfortunately, that also costs money. Lawn-mowing, maintaining the plants, flowers etc. is a very rewarding activity if you like gardening, but does take up a lot of time and money.
9. Safety and security
Another thing you will end up spending on is safety measures. Whether it is a closed-circuit tv or a full-time security guard, you will have to factor in this cost. Even if you live in a society where this is paid for out of society funds, remember the increased cost comes out of your contribution.
10. Emergencies
And last but not least, are the costs you cannot predict – the unexpected ones. A car crashes into your lawn. A child draws on a wall with un-washable ink. A pet destroys a piece of furniture. An unexpected cost like this can come up at any time – after all, life is nothing if not unpredictable. Be prepared for things you cannot prepare for!
