When you are thinking of buying a house or property, you have to face many types of expenses. One of these expenses is EDC, which is called External Development Charges. Developers are required to pay this charge to the local government. But the question is why they charge this fee and what effect it has on your home-buying deal. Let’s find out.
What is EDC?
External Development Charges is EDC’s full name. It means an external development fee. This is a fee that developers must pay to local authorities. This money is used for the development of infrastructure outside the project.
Why is EDC taken?
- For the development of infrastructure, EDC money is used for the development of the city or area. This leads to building roads, a water supply, sewers, parks, schools, hospitals, and other needed facilities.
- To promote urban development: EDC’s funds speed up the city’s growth. They improve the city’s infrastructure and people’s quality of life.
Effect of EDC on your home-buying deal
EDC has a direct impact on your home-buying deal. Developers have to pay this fee, and its burden ultimately falls on the buyers. When you buy a property, you have to pay a certain amount to the developer as EDC.
How much is EDC charged?
EDC charges vary in different cities and regions. They are decided by the local authorities. In some cities, the EDC charge may be low, while in others it can be very high.
How does EDC affect you?
EDC has a direct impact on your pocket. When you buy a property, the builder charges you an more amount as EDC. This amount is added to the total cost of your property.
Benefits of EDC
EDC has some advantages:
- Better infrastructure is built with EDC money. It increases your property’s value.
- Better living experience: Due to better infrastructure, you get a better living experience.
- City development: EDC money develops the city, making it better and more beautiful.
Disadvantages of EDC
EDC has some disadvantages:
- More cost: Due to EDC, the cost of your property increases.
- Obscurity: Builders often misstate the EDC, causing problems for buyers.
- Unjust charge: Some builders charge extra in the name of EDC.
What precautions should we take about EDC?
Get clear information from the builder: Ask the builder how much the EDC amount is and where it will be used.
- After paying the EDC amount, make sure you obtain a receipt.
- Check details on the RERA website: Visit the RERA site for project details, including EDC info.
- Avoid unfair charges. If you think the builder is overcharging for EDC, complain to RERA or the relevant authority.
Some important things about EDC.
- EDC money goes directly to the government account, so developers cannot misuse it.
- Information about EDC is given in the sales documents for the project.
- If you are going to buy a property, then you must know about EDC.
- Sometimes, developers include EDC in the property price. Buyers then don’t know how much EDC they are paying. So, you should always be careful and get complete information about all the expenses.
Q&A about EDC
Question 1: Is EDC a new tax?
Answer: No, EDC is not a new tax. It is a type of development charge that has been levied for a long time.
Question 2: Is EDC levied on all properties?
Answer: No, EDC is not levied on all properties. It depends on the rules and regulations of the local authorities.
Question 3: Is the money received from EDC used properly?
Answer: Yes, EDC money is used as per the rules set by the local authorities. The city’s development is funded using these funds.
Question 4: Where can I get more information about EDC?
For more info on EDC, contact the municipal corporation or the relevant authorities. You can also get information from the property developer.
Conclusion
EDC is an important charge that affects your home-buying deal. You should get complete information about EDC and make a wise decision. If you have any doubts about EDC, you can consult an expert.