Land registration in Bangalore to spike as guidance value rise

In a move to create a stir, the Karnataka State Government has revised the guidance value for registration of properties that will come into effect from August 2013. The new guidance value is proposed to introduce with the revised state budget for the year.

According to market news, by putting into effect the revised guidance value, the land registration cost will soar high, however, the stamp duty will not be scratched and remain fixed at 5%. According to the Stamps and Registration Department, the average increase in the draft guidance value of properties in urban Bangalore is nearly 30%. The stacking up in guidance value ranges between 10-150 % on the basis of the growth and development of the regions.

Using Geographical Information System

The Central Valuation Committee has set its eye for a hike in guidance value for areas, which has experienced high-valued transactions like south-eastern and North Bangalore. For this purpose, the government has used the Geographical Information System (for the first time ever) to determine areas that have witnessed a growth in the number of apartments, recently.

To add to it, government officials have also brought into notice that the guidance value for certain areas in Bangalore will be mowed down since such regions did not witness growth in property transactions. What is more, the guidance value of such areas was relatively higher than the market rate for the properties. According to JLL, the slum areas in Bangalore have witnessed the minimum rise in guidance value of properties with about 10%, in comparison to central parts of Bangalore where it is 20%. Below-mentioned is the proposed hike in the guidance value for some areas of Bangalore-

Impact on Villas

In accordance with the new system, registration of houses and villas in the gated neighborhoods has been included with the guidance value being permanent for the first time. Guidance value for such plots on the eastern part of the city (like K. K. Puram and Mahadevapura) south-eastern parts (like Sarjapur road and Hosur road) and northern parts (comprising of Yelahanka and Bellary road) run of between Rs 500- Rs 1000 per sq ft. Due to the revised guidance value, the cost of villas will zoom up by 20% and and apartments by 13%-16% in Bangalore.

The latest surge in the guidance value for an acre in Kacharakanahalli is glued at 9.9 crore, whereas in certain areas such as Kundalahalli, , Nagawara, Doddanakundi, Hennur and areas adjoining the Outer Ring Road and National Highway the revised value is fixed within the range 6.5-9 crore.

Officials of Registration and Commissioner of Stamps further corroborate that the revision was on thin ice since more than 50% of the revenue for the Department of Stamps and Registration punch in from registration fee (1%) along with surcharge/stamp/Cess fee (6.65-6.75%). Sources also confirm that the department has stacked up around 5265 crore during the tenure 2012-13 and intends to raise the bar by accomplishing a target of rs 6500 crore for the present financial year 2013.