Introduction: GST and Real Estate in Mumbai

Mumbai’s real estate market is one of the most dynamic in India, attracting both end-users and investors. With property prices constantly evolving, government regulations like Goods and Services Tax (GST) play a major role in shaping affordability.

The new GST rules aim to bring transparency, standardization, and fairness to real estate transactions. For buyers considering premium or affordable projects from Romell Group, understanding GST implications is crucial to making smart investment decisions.

In this guide, we’ll break down how GST impacts under-construction vs ready-to-move-in flats, how to calculate GST, what qualifies as affordable housing under GST, and why choosing the right developer matters.

How to Calculate GST on Flat Purchase

When buying a property in Mumbai, knowing how GST is applied helps you plan better.

• Ready-to-Move-In Flats – No GST is applicable if the developer has received a completion certificate before the sale.
  
• Under-Construction Flats – GST is charged based on property type:
  
  
  • 1% GST on affordable housing (without ITC).
    
  • 5% GST on non-affordable housing (without ITC).

Formula for calculation:
 GST = Property Value × GST Rate

Example:

• A flat priced at ₹40 lakh in the affordable segment → GST = ₹40,00,000 × 1% = ₹40,000.
  
• A non-affordable apartment priced at ₹1 crore → GST = ₹1,00,00,000 × 5% = ₹5,00,000.

Romell Group offers transparent, carpet-area-based pricing and factor GST into their payment schedules, ensuring clarity for buyers.

GST on Flat Purchase Under-Construction

Under-construction properties attract GST because they are treated as a “supply of service.”

Key Points:

• GST applies only until the project obtains completion/occupancy certificate. Once the Occupancy Certificate (OC) is issued, no GST is charged.
  
• Buyers can benefit from staggered payments, making under-construction homes easier on the pocket compared to a lump sum for ready flats.
  
• For premium projects like those by Romell Group, the applicable GST rate is 5%, ensuring transparency and compliance with current tax laws.

This means homebuyers investing in Romell Group’s under-construction properties can plan finances better with clear tax implications while enjoying long-term appreciation by the time of possession

What is Affordable Housing as Per GST

The government defines affordable housing under GST to ensure middle-class families get financial relief.

Criteria:

• Carpet area of up to 60 sq. meters in Mumbai Metropolitan Region (MMR) (including Mumbai).
  
• Property value capped at ₹45 lakh.
  

GST Rate:

• 5% (without ITC) on under-construction properties that qualify.

This makes Premium housing projects an attractive choice for first-time buyers in Mumbai. Romell Group are active in this segment, offering modern homes that meet GST criteria.

Impact of New GST Rules on Mumbai’s Homebuyers

1. Increased Transparency – Clear division between ready and under-construction flats ensures buyers know exactly when GST applies.
   
2. Encouragement for Affordable Housing – Reduced GST rates for affordable housing push demand in suburban hubs.
   
3. Price Standardization – Buyers benefit from consistent rules across all states, reducing regional confusion.
   
4. Developer Credibility Matters More – With RERA and GST compliance, Romell Group stand out as safer choices.
   
5. Shift in Buying Trends – More buyers are open to under-construction projects, balancing GST costs with lower entry prices and future appreciation.
   

Comparison: Ready-to-Move-In vs Under-Construction under GST

Factor	Ready-to-Move-In Flats	Under-Construction Flats
GST Applicability	No GST if completion certificate issued	1% (affordable) or 5% (non-affordable)
Possession	Immediate	Wait until construction completion
Cost	Higher upfront price	Lower entry cost + GST
Customization	Limited	Some flexibility in interiors & layouts
Appreciation Potential	Already priced at market rate	Higher appreciation as construction progresses

This makes under-construction homes appealing for buyers seeking value and flexibility, while ready-to-move-in homes are better for those wanting immediate possession.

Why Romell Group is the Right Choice for GST-Compliant Homes

Romell Group has been shaping Mumbai’s skyline with projects that balance affordability, design, and compliance. Under the new GST rules, they ensure:

• RERA-registered, GST-compliant projects.
  
• Transparent pricing with no hidden costs.
  
• Premium developments for buyers looking at long-term investment.

For homebuyers in Mumbai, this means peace of mind and reliable investment returns.

Conclusion: Smarter Property Decisions in 2025

The new GST rules in India bring much-needed clarity to the real estate market. For Mumbai’s homebuyers, this means:

• No GST burden on ready-to-move-in homes.
  
• Affordable GST rates on under-construction flats, especially in the affordable segment.
  
• Better transparency, accountability, and buyer protection.

With Romell Group, you can navigate GST regulations confidently and choose a home that matches your budget, lifestyle, and long-term financial goals.

FAQs

Q1: How to calculate GST on flat purchase in Mumbai?
 Multiply the flat’s value by the GST rate. Affordable housing attracts 1% GST, while non-affordable housing attracts 5% on under-construction projects.

Q2: Is GST applicable on ready-to-move-in flats?
 No. Ready-to-move-in flats with a completion certificate are exempt from GST.

Q3: What is affordable housing as per GST rules?
 Affordable housing refers to homes with a carpet area up to 60 sq. m in metros (90 sq. m in non-metros) priced below ₹45 lakh.

Q4: Does GST increase property prices in Mumbai?
 Not always. While GST applies to under-construction flats, the base price is usually lower, making them competitive compared to ready homes.

Q5: How does Romell Group ensure GST compliance?
 Romell Group includes GST in its transparent pricing model and ensures all projects are RERA-registered for buyer protection.