Maharashtra raises ready reckoner rate

The increase in the ready reckoner rate in Maharashtra is likely to have an impact on statutory property buying cost such as stamp duty and registration charges. Industry watchers say that any rise in these levies would increase project costs, which developers will have to recover from customers.

The Maharashtra government has increased the ready reckoner rate by an average of seven per cent from April 1. The rates have been increased by four per cent for Navi Mumbai and six per cent for Pune.

Reckoner rates are assessments of property value by the State government on the basis of which stamp duty and registration charges are paid. The government usually revises these rates every year.

‘Moderate hike’ Revenue Minister Eknath Khadse termed the hike as moderate compared to the increases in corresponding rates in the last six years. The State government had deferred the decision on revising ready reckoner rates to April from the usual practice of yearend revision following sluggishness in the property market.

Sanjay Dutt, MD, Cushman & Wakefield said, “Although the increase is moderate, it would likely result in a higher outgo on part of homebuyers / developers. Homebuyers would be faced with increased burden of stamp duty and registration charges and recurring property taxes, leading to cautious buying sentiments. This comes at a time when the residential segment’s sales velocity is already tepid. Developers too would be faced with a higher outgo as stamp duty at the time of land purchase, fungible FSI and TDR are determined by ready reckoner rates.”

Rohit Gera, MD, Gera Developments & VP – CREDAI - Pune Metro said, “The increase is not at all in line with the market conditions. Over the years, the price rise has been under one per cent. This is an example of the government's words and actions being out of sync. On one hand there is a statement to provide housing for all, on the other hand this move makes it more expensive for home buyers by increasing their Stamp Duty costs. The ready reckoner is set by looking at average rates in a location. This means there will be some flats below average and some above.”

Several other developers said that it was an unfair move affecting the affordable home buyers.

Sandeep Ahuja, CEO, Richa Realtors said on one side government is trying to push its pet projects like housing for all and ease of doing business; on the other hand, things are not so great from the developers side who now have to face a hike of seven per cent in Ready Reckoner Rates. This may affect some micro markets like Nariman Point, Bandra and suburbs.

COMMENT NOW