5 Things to Know Before Purchasing a house or flat from the Builder

Are you planning to buy your dream house?

Have you made the final choice for your ideal home and just left with signing of the house agreement?

Is your home loan approved? Are you also done with all the other major formalities?

If the answer to the above questions is a yes, which makes you think that half of your burden is gone and the things ahead will go on in a smooth and orderly fashion, then you actually need to rethink.

I say this because, even with the major work done, one still has the big task of protecting his/ her dream coming true, from the legal traps of the builder.

In such a scenario, some points that need to be remembered and certain measures that should be taken against those tricks.

Table of Contents:

• Actual selling price of the house
• Actual size of house
• The Carpet Area
• Possession Date
• Certificate of Completion
• Bonus Insight: Hidden Costs You Might Miss
• Other Key Considerations

Actual selling price of the house

According to the property agreement, the buyer is required to bear the purchase price of the house.

This cost includes the utility expenses such as water, electricity, parking, various taxes levied, and registration costs too, at times.

The builder might also impose certain extra charges on any of these thereafter.

One of the first things to check before buying a flat is whether the builder has included hidden charges in the final builder quote.

Always clarify this before signing.

Alert Tips:

• One should read the agreement thoroughly and check for all details in the agreement including all the charges applicable.
• Get the agreement verified by a lawyer for any hidden charges, and get the same rectified (if any).
• In case of builder asking for altering the original plan, ask for the approval from the government authorities in the form of a sanction letter.

Actual size of house

In your house agreement, the size of the house is clearly stated, but it will also contain a clause stating that the plans, design and specifications to be temporary, with the developer reserving the sole right to make any changes.

So, you never know if you will actually get the same size for which you agreed upon.

Before buying a flat, confirm whether the size mentioned is carpet area or super built-up area.

This is one of the most important things to know before buying a flat in India.

Watchful Tips:

• It is suggested to do some research on the builder’s earlier projects, before going further with any kind of deal.
• It will also be beneficial to have a discussion with other buyers, who have already got the possession, about the kind of problems faced by them.
• One can also try to include a clause from his side in the agreement about the minimum and maximum size beyond which the size cannot be increased or decreased by the builder.

The Carpet Area

The area of an apartment excluding the wall area is termed as the carpet area.

This is the area where the carpet can be laid.

Then, there is the built-up area which includes area of walls and the balcony, and the carpet area.

This built-up area, along with common areas such as lifts, lobby, staircase, gardens, pool, etc. is termed as the super built-up area.

Many buyers overlook this, but carpet area is a critical point in the purchase of dwelling house/flat on ownership from a promoter.

Always insist on written mention of carpet area in your flat purchase agreement.

Tips:

• Always buy a property based on its carpet area.
• Always ensure that area is mentioned in the agreement papers.
• Try and include a clause for contract termination, in case builder provides a house with a lesser carpet area than mentioned in the contract.

Possession Date

The agreement will generally have a tentative date of house possession.

Although, there have been instances where the possession date mentioned has been delayed for more than a year.

When buying house from builder, always ask for a clear possession timeline.

Delay in handover is one of the most common issues first-time buyers face.

Tips:

• Check the construction progress often, and in person.
• If you find the progress slow compared to what it should have been, which might delay your possession date, one can always pressurize the builder.
• Also, forming a society with other buyers might also help in getting the things speed up at the builder’s end.

Certificate of Completion

The builder is also supposed to provide a completion certificate, while handling the house to you.

This certificate is issued by the municipal authorities, which is an establishment of the compliance with the approved plan.

This certificate is required for house registration and other legal formalities.

Among the key documents to check before buying a flat from builder, the completion certificate and occupancy certificate are the most important.

Without them, your flat may face legal and utility connection issues.

Tips:

• Always ensure that the agreement either states about the certificate or has a clause stating the builder’s liability to provide the certificate.
• If the builder delays in the process of providing the certificate, do pressurize him with other buyers.

Bonus Insight: Hidden Costs You Might Miss

Most first-time homebuyers assume the flat’s quoted price is the final cost. Unfortunately, that’s far from reality. Builders often add multiple hidden charges that can increase your total payment by 10–20%. Missing these can create a huge hole in your budget later.

Here are some of the most common hidden costs you should be aware of:

• GST (Goods & Services Tax): Usually applicable for under-construction properties. This alone can add a few lakhs depending on the property value.
• Floor Rise Charges: Buying a flat on a higher floor? Many builders charge extra per floor, which can surprise you if you prefer top-floor living.
• Parking Charges: Car parking is rarely free. Covered or reserved parking slots may cost a few lakhs separately.
• Clubhouse & Amenities Fee: Even if you don’t plan to use the gym, swimming pool, or clubhouse, builders may add a mandatory “amenities fee.”
• Maintenance Deposit / Advance Maintenance: Builders often ask for 1–2 years of advance maintenance charges before handing over possession.
• Legal & Documentation Charges: From agreement drafting to registration and stamp duty, these costs are over and above the flat price.
• Infrastructure / Development Charges: Sometimes included as “one-time charges” for external development like roads, sewage, or electricity.

👉 Pro Tip: Before committing, always ask the builder for a detailed cost sheet with break-up. Don’t rely only on the advertised price, because the “all-inclusive cost” may look very different once these hidden charges are added.

Other Key Considerations

Apart from the above mentioned, there are also certain other things that needs to be taken care of, such as: management of society, construction material quality and durability, etc. which should be clarified with the builder before making any agreement.

For this purpose, one can even try adding certain clauses in the agreement for the builder to agree to your demands.

Also, because there is no industry regulator for such constraints, the best way to handle such issues is to remain alert and aware of your requirements and acquisitions.

If you have any comments or questions, write them in the comment box below.

Or are you interested in creating a Comprehensive Financial Plan for your financial goals?

Skip the queue by registering for your 30 Minute FREE Financial Plan Consultation. Click the ‘‘BOOK YOUR SLOT NOW!’’ button below.