Cost Calculations and Checklists
New launch, ready-to-move or resale flat: which costs more in India? A cost comparison
Compare the full cost of an under-construction flat, a ready flat from a builder and a resale flat in India: GST, stamp duty, brokerage, pre-EMI, rent while waiting and risk.
At the same headline price, an under-construction flat costs most on top of the price. It carries 5% GST (1% for affordable housing), and you often pay pre-EMI interest and rent while you wait for possession. A ready-to-move flat from a builder with a completion certificate has no GST and no wait, but builders rarely discount it as much. A resale flat has no GST either, but usually involves brokerage of 1–2% plus GST, a society transfer fee and a closer title check. Stamp duty and registration apply to all three. The comparison below puts illustrative numbers on each route.
All figures are illustrative. Use your state's rates and the actual quotes you receive.
Side-by-side: ₹1 crore flat in three ways
Assumptions: city with 6% stamp duty and 1% registration (no cap), home loan of ₹75 lakh at an illustrative 8.5%. Rent of ₹25,000 a month paid until possession.
| Cost | Under-construction (possession in 30 months) | Ready from builder | Resale |
|---|---|---|---|
| Price | ₹1,00,00,000 | ₹1,00,00,000 | ₹1,00,00,000 |
| GST | ₹5,00,000 (5%) | Nil | Nil |
| Stamp duty | ₹6,00,000 | ₹6,00,000 | ₹6,00,000 |
| Registration | ₹1,00,000 | ₹1,00,000 | ₹1,00,000 |
| Brokerage | Nil (booked direct) | Nil (direct) | ₹1,18,000 (1% + GST) |
| Society transfer / corpus / advance maintenance | ₹1,50,000 (corpus + maintenance in advance) | ₹1,50,000 | ₹25,000 transfer fee |
| Pre-EMI interest while building | ≈ ₹4,00,000 (illustrative, staged disbursement) | Nil | Nil |
| Rent until possession | ₹7,50,000 (30 × ₹25,000) | Nil | Nil |
| Total cost including price | ≈ ₹1,25,00,000 | ≈ ₹1,08,50,000 | ≈ ₹1,08,43,000 |
The rent line applies only if you would otherwise move in now. If you already live in your own home or with family, drop it. Even then, the under-construction flat costs about ₹9 lakh more, mainly from GST and pre-EMI interest. To be fair, it has to be cheaper at the outset or appreciate faster to break even.
When an under-construction flat still makes sense
- The price gap is large. If the under-construction price is 10–15% below comparable ready stock in the same micro-market, the extra charges may be covered.
- You do not need to move soon. No rent line, and a slower payment schedule.
- It is affordable housing. At 1% GST and lower stamp duty slabs in some states, the difference shrinks.
- The project is RERA-registered with a credible timeline. The RERA escrow and completion date protect you. See the RERA complaint guide.
- You want a specific layout or amenity that is not available in older stock.
When resale often wins
- You need to move in within months.
- The micro-market is established, so prices are visible and comparable.
- You can negotiate brokerage down or buy directly from the owner.
- You want to see real maintenance quality and how the society runs.
The trade-off is title risk. A resale purchase depends heavily on the documents checklist and an advocate's review.
Hidden differences in the price itself
Builder prices are often quoted on super built-up area, while resale prices are quoted per flat. RERA requires sale agreements for registered projects to be based on carpet area. Convert every quote to price per square foot of carpet area before comparing:
- Under-construction quote: ₹9,000 per sq ft on 1,100 sq ft super built-up = ₹99 lakh. Carpet area 780 sq ft, so the effective price is ₹12,692 per sq ft of carpet area.
- Resale flat: ₹1 crore for 820 sq ft carpet area = ₹12,195 per sq ft of carpet area.
On a carpet basis, the resale flat is cheaper per usable square foot before you even add GST to the new one. Also check what the builder price includes: car park, club, PLC, floor rise, power backup and legal charges are often extra.
Risks that are costs too
| Risk | Under-construction | Ready from builder | Resale |
|---|---|---|---|
| Delay in possession | High; RERA interest is a remedy, not a guarantee | Low | None |
| Quality defects | Unknown until built; 5-year defect liability under RERA section 14 | Visible; defect liability still applies for registered projects | Visible; no builder liability after five years |
| Title problems | Developer's land title; check the RERA registration | Same | Seller's chain of title; higher individual risk |
| Price negotiation | Limited, schemes and offers | Builders may discount unsold stock | Usually most negotiable |
| Exit before completion | Resale of booking possible but may need builder consent and a transfer fee | – | – |
FAQ
Is the 5% GST charged on the full price or each instalment?
On each instalment as it falls due, at the effective rate. The total is 5% of the agreement value.
Does stamp duty differ between the three routes?
The rate is the same. What may differ is which document is stamped and when. In some states the agreement for sale with a builder carries full duty. The agreement versus sale deed guide explains this.
Are ready-to-move flats from builders always free of GST?
Only if the completion or occupancy certificate has been issued before the sale. Ask for a copy.
Which route gets a better home loan?
Lenders finance all three. Under-construction loans are disbursed in stages, and lenders may approve only projects they have checked. See the overall total cost example.
Sources
- CBIC GST portal — GST on residential construction
- Ministry of Housing and Urban Affairs — RERA Act, carpet area definition and state authority links
- MahaRERA — example of a state RERA project search
- See also GST on under-construction flats and the comparison of purchase routes
