The real estate sector has welcomed the new measures of the state government in the Budget presented on Friday in the Assembly. The incentives come at a time when there has been a visible dip in the real estate market. Real Estate Analysts Colliers International said that the Kolkata market has been hit especially after demonetisation. In the existing system, stamp duty of seven per cent is levied even if construction of the property was yet to start. This has now been changed (see box). The incentives will be available for all properties purchased from January 1, 2015 onwards. This means that on a property worth Rs 50 lakh, the buyer will have to pay registration fee of Rs 1 lakh instead of Rs 3.5 lakh.
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Chairman of the Ambuja Neotia group Harshvardhan Neotia on Saturday said, “Keeping the registration of sales at two per cent is likely to provide a much required fillip to the real estate market. The conditions that have been brought in for the agreements of sale is also extremely agreeable. The earlier arrangement meant the agreement would be made at a particular price but the stamp duty would be different – much higher. What the Finance Minister has done is important. It has facilitated the ease of doing business.”
Neotia further added that the “incentives” would ensure compliance of registration procedure. “And therefore revenue for the government will also increase,” he said.
Says Swapan Dutta, Senior Associate Director Colliers, “The Residential market situation in Kolkata was dominated mostly by end users and not investor-driven and the hit was witnessed mostly with the luxury property prices dipping 25%-30%. Developers are struggling to dispose properties and liquidate. Interest rates have weakened a little giving scope to middle and lower income group to go for outright purchase. No new residential projects was launched post the demonetization exercise. Resale options in residential was hit more badly.’’
Dutta adds that the real estate market in Kolkata has behaved in a similar way to Delhi, Mumbai and Noida after demonetisation. “Surplus inventory is still existing with drop in prices. Luxury Project prices has dipped. Resale of residential properties at prime locations across the city has slowed down heavily. With the prices stabilising soon, buying property for middle & lower income group in Kolkata will be easier with the lowered interest rates,’’he said.