Some realtors feel that demand alone has not been the cause for this universal rise. A look by K. Sukumaran
A recent survey done by an international consultant firm in real estate has projected a 50 per cent contribution to India’s GDP by the year 2025. Global Property Guide, which collates real estate data across the world, says that there has been significant appreciation in real estate prices over the last two years. It also states that Delhi has witnessed a rise as steep as 60 per cent as compared to Dubai or Hong Kong during the same period. Many of the Indian metros have also seen a substantial rise.
Some realtors feel that demand alone has not been the cause for this universal rise. They consider income from stamp duty and registration to the exchequer as an easy way to shore up revenue. Bangalore and the National Capital Region are two centres where guidance or ‘circle’ rates have undergone manifold revisions over the last 10-15 years. In earlier days, the revision in stamp duty and registration charges formed part of annual budgets. Factors such as increasing demand for housing, and easy availability of bank loans for buying and construction of property pushed up the market price. The most significant revision in Karnataka was effected in August, 2004, when the high-level Central Valuation Committee (CVC) stepped in. The next revision was in October, 2005. February, 2007, saw another steep revision varying from 35 to 350 per cent. The next came about in 2011.
The preliminary notification in regard to the current revision was published on July 17. Many objections have been made against this revision. The final notification, which came out on August 12, appears to have taken into consideration many of the objections. Some features of the current revision are:
As against the earlier ones, the present rates are more or less in line with the figures quoted by sellers and brokers almost everywhere.Type of construction and amenities available, have been taken into account while fixing the guidance value. Villas and gated communities are to bear the brunt of the rise.
Purchase of property has now become a costly proposition.