The exercise of revising guidance value of properties in the State being taken up by the Department of Stamps and Registration has not only sent the property prices soaring but is also expected to fetch the State coffers 30 per cent to 40 per cent more revenue.
The guidance value revision process is set to be completed in the State, including Bangalore Urban, by May. It has been revised in Mangalore, Udupi, Kodagu and Chamarajanagar districts. The revision of guidance value is said to be anywhere between 10 per cent and 50 per cent, depending on the area.
With this, the revenue collection through stamp duty and registration is expected to exceed Rs. 4,500 crore during 2011-2012 as against Rs. 3,758.64 crore revenue collected during 2010-2011.
“It had been three years since the guidance value had been revised, and hence the revision has been taken up. We are expecting the revenue to go up by 30 per cent to 40 per cent in this financial year alone,” Inspector-General of Registration and Commissioner of Stamps B. Shivappa told The Hindu. “We have worked out a schedule to revise property values and will complete it before May,” he said.
Property registration, which had taken a hit from 2007 to 2009 due to recession, has seen an increase during 2010-2011. In fact, revenue collection went up by Rs. 941 crore in 2010-2011 over the previous year. “It is also in the light of improved situation in the real estate sector that the revision exercise is being taken up,” an official said.
Further, the official said that there has been a huge difference between the prevailing market value and the guidance value, and that this gap has to be reduced.
While the guidance value is being revised across Karnataka, it is the revision in Bangalore Urban and Rural districts which is expected to fetch the department more revenue. In fact, Bangalore Urban district alone contributed to 68 per cent of the total revenue to the department in the last financial year with a collection of Rs. 2,556.94 crore. The last revision of guidance value in Bangalore was in 2007.
Meanwhile, property prices have started moving up with some areas witnessing abnormal increase. “What used to be sold for Rs. 8,000 per square feet is now being quoted for Rs. 12,000 in Fraser Town in Bangalore. Due to this abnormal increase, sales have come down a bit,” a real estate dealer said and similar was the case with many areas in Bangalore that have seen a sudden jump in prices.