Bengaluru property buyers may incur higher transaction costs after the Karnataka government doubled registration fees from 1% to 2% under the Registration Act, 1908. Experts warn the move could pressure cost-sensitive homebuyers and weigh on sales in the affordable and mid-income segments.
While it is expected to boost state revenues, the hike may further dent buyer sentiment in a market already facing affordability concerns, they say.
“The Government has revised the registration fee from 1% to 2%, with effect from 31st August 2025. This measure has been introduced to strengthen administrative processes and ensure better service delivery,” according to a notification issued by the Department of Stamps and Registration on August 29.
Karnataka has increased the registration fee on property transactions and other documents for the first time since 2003. From August 31, buyers in Karnataka will have to pay a total of 7.6% of a property’s market value as charges on transactions. This includes 5% stamp duty, a 2% registration fee, 0.6% cess and charges.
Defending the move, the government officials said the revision was needed to ‘rationalise’ rates, pointing out that Karnataka had among the lowest stamp duty and registration costs on immovable property compared to neighbouring states.
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How much will homebuyers have to pay?
{{/usCountry}}Defending the move, the government officials said the revision was needed to ‘rationalise’ rates, pointing out that Karnataka had among the lowest stamp duty and registration costs on immovable property compared to neighbouring states.
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How much will homebuyers have to pay?
{{/usCountry}}Following the recent hike, homebuyers in Karnataka will see a sharp jump in registration costs. For instance, the registration fee on a flat priced at ₹75 lakh, earlier charged at 1% or ₹75,000, will now be levied at 2%, taking the fee to ₹1.5 lakh. This means buyers will have to shell out an additional ₹75,000 just towards registration.
The impact is even more visible for higher-value properties. On a home valued at ₹1 crore, the registration cost will rise from the earlier ₹1 lakh to ₹2 lakh under the new structure, effectively doubling the amount and adding an extra ₹1 lakh burden on the buyer.
When all charges, including stamp duty, cess, and surcharge, are added, the overall expense climbs significantly. A ₹1 crore apartment in Bengaluru will cost about ₹1.076 crore after adding 7.6% in stamp duty, registration fee, cess, and surcharge. A ₹2 crore apartment in Bengaluru will now cost around ₹2.152 crore after factoring in the revised statutory charges. At 7.6% of the property value, buyers will pay an additional ₹15.2 lakh towards stamp duty, registration fee, cess, and surcharge, significantly increasing the overall cost of purchase.
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Major impact on budget-conscious buyers, say experts
According to experts, the proposed hike in registration fees will make property transactions costlier, stretching the financial plans of budget-conscious buyers. “While the government coffers will see generous top-ups with higher property registration fees, housing sales may be impacted to some extent, particularly in the affordable housing segment,” Prashant Thakur, executive director and head - research and advisory, ANAROCK Group, said.
However, experts noted that the overall effect would likely be limited, since both sales and new launches in the affordable category have already been very low in recent years. Premium and luxury housing, Thakur said, would be largely insulated as its buyers are better positioned to absorb additional costs.
“If we compare the combined stamp duty and registration charges in Karnataka to those in other states, it is relatively lower at about 6.6% for high-value properties before the hike, though not the absolute lowest. It offers a competitive advantage, especially when compared to some of its southern neighbours such as Tamil Nadu, where stamp duty alone is 7% and registration charges stand at 4%,” he said.
Industry estimates suggest Bengaluru’s housing market was already slowing before the announcement. ANAROCK Research data shows the city saw about 30,120 home sales in H1 2025, a 12% drop from 34,145 units in the same period last year.
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Property owners say the hike will place a major burden on middle-class homebuyers
Bengaluru homebuyers say that the actual cost of purchasing an apartment goes far beyond the base price, with mandatory charges and compliances adding up to nearly half the total expense.
Vikram Rai, a homebuyer, said that buyers end up paying 40–45% of the property’s value towards various charges such as registration fees, cesses, fire NOC, utilities, and other formal and informal payments. “When you add everything, you are literally paying almost half the value of the asset again in compliance,” he explained.
He further questioned the fairness of such costs. “Today, homebuyers need to ask: what is the real value of real estate? The government should be more considerate about what the middle class is paying. When charges keep increasing, are facilities for the average buyer improving at all?”
He pointed to Bengaluru’s crumbling infrastructure, from frequent flooding to worsening traffic, as evidence that higher charges are not translating into better civic amenities. He said that without visible improvements on the ground, the extra financial burden feels unjustified for ordinary homebuyers.
Other Bengaluru buyers echoed similar concerns, pointing out that while charges continue to rise, the quality of infrastructure and facilities has not kept pace. Dhananjaya Padmanabhachar, convenor of the Karnataka Home Buyers Forum, said buyers are being forced to shell out an extra 1% of the property value to the government, but continue to face risks around ownership clarity. “The government seems more focused on collecting revenue than guaranteeing property rights,” he said.
He pointed out that despite Supreme Court directions that utilities like BESCOM and BWSSB connections, as well as home loan sanctions, should not be given without an Occupancy Certificate or Completion Certificate, sub-registrars still register such properties freely. “Even basic safeguards such as ensuring the seller’s name is in the land records or enabling auto-mutation of ownership after registration are not being implemented,” Padmanabhachar said.