Reduction in guideline value implemented by the State Government is not expected to revive the real estate sector.
According to a document writer here, the real estate sector is already down and property registrations have dropped drastically. The 33% reduction in guideline value and increase of fees to 4 % will only affect the public further. Registrations will come down further, he said.
K. Kathirmathiyon, secretary of Coimbatore Consumer Cause, said the reduction in guideline value will bring down the revenue to the government, increase flow of unaccounted money, and hit land owners whose land is identified for infrastructure projects.
According to the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation, and Resettlement Act, 2013, compensation to be paid in rural areas is four times the value of the land and twice the value in the case of urban areas. The government seems to have reduced the guideline value in order to pay lesser compensation to property owners and nullify the effects of the Act, he said.
“Since the government is to pay compensation to the land owners based on the guideline value it seems to have deliberately lowered the guideline value so that it is enough to pay lesser amount,” he said.
The benefit for property buyers is marginal as the fees has been increased to 4 %. Property purchase might not go up just because there is a marginal decrease in the total cost that the buyer will shell out, he said. In most cases, the guideline value is lower than the market price. Just because the government reduced the guideline value, the market price would not come down. So, more payments will be unaccounted, Mr. Kathirmathiyon said and appealed to the government to reconsider its decision.
