AKG Money

What did my flat really earn?

“We bought for ₹1.5 crore and sold for ₹3 crore” sounds like doubling your money. Count the interest, stamp duty, upkeep, brokerage and tax, and see what you really made each year.

These are example numbers. Change any of them to see your own answer.

When you bought
₹

= ₹1.5 Cr

Usually 6–8% of the price. They count as part of your cost.

₹

= ₹10.5 L

₹

= ₹30 L

%
years
While you owned it

An average over the years you owned it.

₹

= ₹1 L

When you sell
₹

= ₹3 Cr

years
%
₹
₹

Long-term capital gains on property held over 2 years: 12.5%. Short-term gains are taxed at your slab rate.

%
2.3% a year

The price went up by ₹1.5 Cr, but after interest, stamp duty, upkeep, sale costs and tax you made ₹25.82 L: about 2.3% a year on the money you put in. A fixed deposit earns about 7% a year, before tax.

Interest paid to the bank
₹83.18 L
Over 10 years of EMIs of ₹1,00,373
Loan still to repay at sale
₹82.73 L
Paid off from the sale money
Tax on the gain
₹17 L
12.5% on ₹1.36 Cr, after costs
Cash in hand after the sale
₹1.97 Cr
After tax, sale costs and closing the loan

Bought for ₹1.5 Cr, sold for ₹3 Cr

Sale price3,00,00,000

Less: brokerage and fees−3,50,000

Less: tax on the gain−17,00,000

Less: loan left to repay−82,72,875

Less: your down payment−30,00,000

Less: stamp duty and registration−10,50,000

Less: EMIs paid−1,20,44,737

includes ₹83,17,612 interest

Less: maintenance and property tax−10,00,000

What you really made₹25,82,388

Yearly return on your money2.3%

If you lived in the flat, you also saved the rent you'd otherwise have paid, which isn't counted here. If you rented it out, the rent you earned isn't counted either.

You really made₹25.82 L

How this is worked out

  1. Interest and principal paid come from your loan's EMI schedule up to the month you sell. The loan still owed is repaid from the sale money.
  2. Tax: long-term capital gains on property (held over 2 years) are 12.5% of the gain. The gain is the sale price minus sale costs, minus what you paid including stamp duty and registration.
  3. What you really made = cash in hand after the sale − everything you put in: down payment, stamp duty and registration, all EMIs, and maintenance and property tax.
  4. Yearly return is the XIRR of your money: what you paid upfront and every month, against the cash you got at the end.

Questions people ask

Why is my return so much lower than the price rise?

Because most of the price was paid with borrowed money that cost interest, and stamp duty, upkeep and sale costs eat into the gain. A price that doubles in 10 years is about 7% a year before any of that.

Can I avoid capital gains tax on a property sale?

Section 54 lets you skip tax on a long-term gain if you reinvest it in another home within the time limits, and 54EC allows certain bonds up to ₹50 lakh. Check the current rules with a tax adviser.

Isn't there an indexation option?

For property bought before 23 July 2024, individuals can choose 20% with indexation instead of 12.5% without, whichever is lower. Set the tax rate that applies to you.

Does this count the rent I saved by living there?

No. If you lived in the flat, the rent you didn't pay is a real benefit on top of this. Use the rent-or-buy calculator to compare owning and renting properly.

Is my data saved anywhere?

No. Everything is worked out in your browser. Your last numbers stay on your own device, and the page link holds them so you can share them.

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