There is no need of Ready reckoner rate hike in Maharashtra

Q: It is an attempt to uplift the slow property market.

Ravindra Singh,

21st December 2015

Property Tax in Mumbai

ready reckoner rates

ready reckoner rate hike

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Replies (2)

Yes, there is no point in increasing Ready Reckoner rates much, although stamp duty may rise by 5% annually, as usual. The government has already made it clear that the benefit on the depreciation value would be calculated only on the structural component and not on the land component in the overall cost. This will increase the ready reckoner value of the property and hence the cost of registration and stamp duty for buyers.

Suneet Shetty, Noida

21st December 2015

Comment

Hi Suneet,
There was absolutely "nil chance" of the government going in for any hike in Ready Reckner rates in the new year. The government is not in mood to give yet another shock to the sector at present.

akhilesh pal,

21st December 2015

@Akhilesh,
It may be recalled that a recent circular has already increased stamp duty by changing the method of calculation of depreciation with respect to old buildings, which would eventually raise the Ready Reckner value of resold properties by up to 35%. With this development, depreciation will now be allowed to a much lower range of the total cost of resold porperty, thereby increasing stamp duty.

Suneet Shetty, Noida

21st December 2015

Definitely Suneet,
As a result this will impact the buyer as he will have to pay an excess stamp duty while the seller must pay capital gains tax on this additional amount.

akhilesh pal,

21st December 2015

Even as the state's own departments of registration and stamps as well as the directorate of town planning have suggested a average to low (10% and below) hike in ready reckoner (RR) rates. Interest rates on housing loans have fallen significantly and there is a possibility that real estate market may peak again.

akhilesh pal,

21st December 2015

Comment

Currently, the only major issue is that since affordable housing stock does not match the large demand, the real estate market did not have big transactions during the passing year of 2015. Poor sales in 2015, poor availability of affordable housing stock and a huge rise in RR rates in recent years may hit real estate transactions in 2016 as well.

Jay, Delhi-NCR

21st December 2015