BSP Explained: A Key Real Estate Term Every Homebuyer Should Know

When you think about buying a home, you will come across a lot of unique and new terms and abbreviations. Acronyms are plenty, and understanding the vital ones is key to making a good financial decision. BSP is one of them. Now what exactly it is, how it is calculated, and what is the importance of BSP in property buying may not be common knowledge. Nevertheless, it is a critical element, and every potential homebuyer must be aware of it to ensure no essential information is hidden or left unexamined.

Decoding BSP 

The first thing to learn is what is BSP?

BSP or Basic Sale Price, is the fundamental price of a property. It is calculated on the basis of per square foot price without any additional costs to the base price of a flat, a plot, or a villa.  BSP is the base price component when calculating the cost of a home. However, it is just a variable and does not account for the total cost of property ownership which typically includes club membership fees, parking space fees, development charges, PLC, GST, registration fees, maintenance fees, and more.

Is BSP The Final Cost?

BSP provides a rough estimate of affordability or pricing competitiveness, but it does not provide the all-in cost. This is where many first-time homebuyers get surprised. In many instances, builders and developers provide pricing based on BSP to make projects appear affordable, even though the final cost can be much higher.

Distinguishing between BSP and Carpet Area

Super built-up area, which includes everything, including walls, common area, etc, comprises built-up area and carpet area. Usually, BSP is quoted at the super built-up area which means you will be charged greater than the carpet area. This means you are paying for additional space where you do not gain direct benefits, like corridors, staircases, lift, lobby, etc.

Difference Between All-Inclusive Prices and BSP

When you compare properties, do not just use the BSP, but instead, ask for the all-in price, that will include everything to do with the whole package including all taxes, registration fees, and other nitty gritties.

Impact of Market Trends on BSP

BSP is often a reflection of the market dynamic of real estate and market fluctuations can be seen in BSP. For example, areas with a high BSP will be premium zones with better infrastructure, whereas areas with low BSP are locations that are evolving or are on the border regions, where development is taking longer to realize their full potential. Basic Sale Price in real estate is a primary measure when estimating price appreciation or investment returns. A BSP on the increase, with a reasonable timeframe for which it has appreciated demonstrates that demand exists and development is occurring.

Negotiating BSP

While developers are unlikely to decrease BSP altogether, there are some negotiating points of which you can take advantage. Ask the developer to waive additional charges such as parking space cost. You can also ask for value added items for free. Sometimes developers offer designing kitchens with modular cabinets, bathroom vanities, and wallpaper or flooring that make the home more appealing. Inquire about early investor advantages to negotiate a better price.

BSP Value for Ready-To-Move V/s Under Construction Properties

BSP is generally lower on a price per square foot basis for a home that is under-construction in order to encourage early buyers. However the total cost for possession may be higher over time considering that the homebuyer will manage construction linked payment plans and any additional features that are included in the home. With ready to move homes, BSP is usually final and most things that are included in the sale are also reasonably specified so budgeting is easier.

Loan With BSP

Most banks look at the BSP and the carpet area to determine eligibility for a home loan and do not consider the price of final sale. Therefore, having a low BSP will help you to stay close to your budget, have a better loan to value, and avoid over-leverage.

Handling BSP Like A Pro

Now that you have all the basics clear, ensuring that you negotiate the best price and leverage any and all advantages, even in ultra luxury apartments in Hyderabad, that come with BSP to the fullest is key. Remember to always ask for a complete breakup of the total price including the building specification plan, taxes, and charges.

Rather than just comparing cost as per super built up area, be sure to compare cost as per carpet area. If there is a specification plan, get an understanding of which amenities and specifications are part of it. Check the online platforms or property consultants to establish benchmark BSP in the locality, which can help assess how high or low the quoted rate is. Check if price escalation clauses are there within the agreement.

Explore Aparna’s Transparently Valued Properties

At Aparna, we understand the weight of investing in a property. The commitment is huge, and so is the pressure to make the best investment. Getting maximum value for your money is critical, and to simplify this, we ensure the best BSP in the area. Our various projects, spread across Hyderabad offer you a competitive BSP and now that you know how BSP is calculated and what all it includes, get in touch with our representatives to see how we stand out. Transparency is our core value, and bringing you full value for your investment and trust in us is our driving force.

Conclusion

BSP of an apartment is a vital element to inquire about and evaluate. However, assessing it tactically is important to ensure you get the maximum returns. It is not the final price, but understanding what all is included in the BSP, comparing it to market benchmark, and negotiating wisely to get the maximum benefits included is the mark of a great investor. So, before you go out to find apartments, do some research about BSP in the area, and inquire about all key elements mentioned above to ensure you invest wisely.