Karnataka Doubles Property Registration Fee to 2%, Impacting Bengaluru Buyers
The Karnataka government has doubled the property registration fee from 1% to 2%, which is expected to boost state revenues but may dampen sales in the affordable and mid-income housing segments in Bengaluru.
Property RegistrationHousing MarketBengaluruKarnatakaReal EstateReal Estate NewsSep 02, 2025
While the hike is anticipated to bolster state coffers, experts warn that it may further erode buyer sentiment in a market already grappling with affordability issues. According to a notification issued by the Department of Stamps and Registration on August 29, the registration fee has been revised to 2%, effective from August 31, 2025.
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 other charges.
Government officials defended the move, stating that the revision was necessary to ‘rationalise’ rates. They pointed out that Karnataka had among the lowest stamp duty and registration costs on immovable property compared to neighboring states.
The impact of the hike on homebuyers will be significant. For instance, the registration fee on a flat priced at ₹75 lakh, which was previously 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 pronounced 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 now cost about ₹1.076 crore after adding 7.6% in stamp duty, registration fee, cess, and surcharge.
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 of research and advisory at ANAROCK Group, said.
However, experts noted that the overall effect would likely be limited, as 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.
Industry estimates suggest that 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.
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.
Frequently Asked Questions
What is the new property registration fee in Karnataka?
The new property registration fee in Karnataka has been increased from 1% to 2% under the Registration Act, 1908, effective from August 31, 2025.
How much will the registration fee be for a ₹75 lakh property?
The registration fee for a ₹75 lakh property will now be ₹1.5 lakh, up from the previous ₹75,000.
What other charges are included in property transactions in Karnataka?
In addition to the registration fee, property transactions in Karnataka include 5% stamp duty, 0.6% cess, and other charges, bringing the total to 7.6% of the property’s market value.
How will the hike in registration fees impact the affordable housing segment in Bengaluru?
The hike in registration fees is expected to pressure cost-sensitive homebuyers and may negatively impact sales in the affordable and mid-income housing segments in Bengaluru.
What concerns do homebuyers have about the hike in registration fees?
Homebuyers are concerned that the additional costs are not translating into better civic amenities and infrastructure, and that the government is more focused on revenue collection rather than ensuring property rights and ownership clarity.
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