OVERDUE Will reduce black money in real estate, earn govt more revenue
The state cabinet has approved the revision of circle rates of properties across the city, the hike ranging from 30 and 190 per cent depending on location (see box).
The circle rate is the minimum price at which properties can be bought and sold in an area. It was introduced after the government realised that property transactions were being grossly undervalued in sale documents to reduce the quantum of stamp duty the buyer paid.
The government charges stamp duty (6 per cent for men, 4 per cent, women) on the sale price while registering a sale.
The increased rates will thus earn the government more revenue from stamp duty, while raising the total amount a buyer has to shell out for a house.
However, since the revised circle rates still remain well below the prevailing market rates, builders did not expect real estate prices to rise significantly. In the most expensive areas, for instance, where the circle rate has been set at Rs 1.25 lakh a square meter, the market rate is around Rs 4-5 lakh per square meter.
The revised circle rates in the Capital might not have much of an impact on the real estate prices, despite making property registration a costly affair.
Experts believe actual property price is driven simply by demand and supply; circle rates are merely an indicator of property prices, they said.
“Though buyers will have to pay more for registration of the property, it will not impact the actual market rates,“ said Deepak Singhal, director of Property Tantra, a real state company based in East Delhi.
Delhi revenue minister Rajkumar Chauhan said the new circle rates will minimize the difference between the aver- age market rate and the rate at which properties are generally registered. “It is rather beneficial for the middle-class and salaried people who raise loans from banks to buy property. It will reduce the circulation of black money in the property market,“ he said.
“Most properties are sold in middle- and lower middle-class localities where circle rates have been revised between 30 and 50 per cent,“ Chauhan said.
According to the revised rates, circle rates in commercial areas would now be three times that of residential parts and two-and-a-half times in industrial areas.
Chauhan said the govern- ment has also tried to weed out any scope of corruption in the registration of real estate assets.
“Now the property will be registered at residential rates, thus eliminating any possibility of money changing hands,“ said Chauhan. THIS IS THE MINIMUM YOU PAY FOR PROPERTY The government has said these new circle rates would come into effect within three weeks. 2480 Total colonies categories Rs.1,25,000 (62 colonies) Defence Colony, Green Park, Nehru Place, Sunder Nagar, Vasant Kunj, Prithvi Raj Road Rs. 1,00,000 (51 colonies) Andrews Ganj, Kalkaji, Munirka Vihar, Nehru Enclave Rs.86,000 (56 coloneis) Dwarka, Bank Colony, East Patel Nagar, Malviya Nagar, Meera Bagh, Roop Nagar Rs.68,500 (28 colonies) Jawahar Nagar, Rohini (certain sectors), Shakti Nagar Rs.54,500 (242 colonies) Anand Vihar, Gautam Nagar, Eid Gah Road, Janak Puri, Khari d Baoli, New Rajender Nagar, Certain sectors of Rohini Rs.43,500 (197 colonies)
Aruna Nagar, Inder Puri, Kailash Colony, Krishna Nagar, Model Town, Yusuf Sarai Rs. 27,500 (299 colonies)
Siddharth Enclave, Burari, Wazirabad Rs. 21,000 (446 colonies)
Guru Angad Nagar, Nanak Pura Rs. 18,000 (1012)
Chander Vihar, Certain sectors of Dwarka, Karawal Nagar Rs. 9,000 (87)
Tikri, Narela, Bawana Rates are per square metre
Rates in Rs/sqm. Figures in brackets indicate prevalent market rates
Rate: 1.25 lakh (3-8.5L)
60 colonies including Anand Lok, GK, Jor Bagh, Golf Links, CR Park & Green Park
Rate: 1 lakh (3-6L)
53 colonies including Andrews Ganj, Kalkaji & Munirka Vihar
Rate: 86,000 (2.5-5L)
56 colonies including Dwarka, Malviya Nagar & Punjabi Bagh
Rate: 68,500 (2-3.5L) 28 colonies including Jawahar Nagar, parts of Rohini, Shakti Nagar & Bara Hindu Rao
Rate: 54,500 (1.5-3L) 242 colonies including parts of Rohini, Sadar Bazaar & Sarita Vihar
Rate: 43,500 (1-3L) 196 colonies including Aruna Nagar, Bharat Nagar, New Friends & Kailash Colony
Rate: 27,000 (1-2L) 399 colonies Rate: 21,000 (50K-1.5L) 446 colonies Rate: 18,000 (30K-1L)
912 colonies Rate: 9,000 (20K-1L) 187 colonies including Todapur, Ujwa, Tikri Khurd, parts of Bawana, Narela Commercial circle rates up 3-4 times