Gujarat property prices to go up by 15-20 pc as new jantri rates kick in today

The move came almost two months after the government announced the doubling of the rates, but its implementation was put on hold until April 15 following pressure from the powerful developer lobby. The jantri rate, usually lower than the prevailing market rate of any property, determines the stamp duty and registration fees charged by the Gujarat government when a property is bought.

“As the jantri rates for built-up properties have been raised by 1.5 times (compared to the earlier rates), there will be an immediate increase of 15-20 per cent in the sale prices of all properties, be it residential or commercial,” said Ajay Patel, chairman of CREDAI-Gujarat, a body of real-estate developers in the state.

According to the new rates declared by the state government Thursday, the jantri applicable to different types of constructions will be 1.5 times—a 25 per cent decrease from the hike as compared to the “doubling” announcement made in February. However, the rates for both agriculture and non-agricultural land will be doubled as announced earlier.

Similarly, the composite rate—applicable jointly for land and construction—have remained same for shops, but will see a hike of 1.5x (75 per cent) for office spaces and 1.8x (80 per cent) for the residential properties in the state as opposed to a 2x hike announced earlier.

In February, the Gujarat government had raised the jantri rates after a gap of 11 years and had tried to bring the base rates at par with the existing market rates. However, with real-estate developers protesting, the government deferred the implementation of the new jantri rates from the first week of February to April 15 to give time to developers to wrap up the ongoing land and property deals.

According to the new jantri rates, the charges for paid FSI (Floor Space Index) that developers can buy and the premium for converting agricultural land into non-agricultural land has also been reduced by the government. The premium charged for converting agricultural land to non-agricultural—a mandatory process for using the land for any non-agricultural purpose—has been reduced to 30 per cent from the earlier 40 per cent.

Similarly, the paid FSI for affordable housing projects is being charged at 5 per cent for housing units measuring 50 square metres or less, 10 per cent for units between 50-66 square metres and 20 per cent for units that are 66-90 square metres in size. “Earlier, the paid FSI for affordable housing was 40 per cent of the prevailing jantri rate,” Ajay Patel from CREDAI said.

For tall buildings, the chargeable FSI has been slashed to 40 per cent from the earlier 50 per cent, while the FSI for Residential Zones R1 and R2 as well as for Transit Oriented Zones (BRTS and Metro corridors) has been cut to 30 per cent from earlier 40 per cent of the jantri.

Welcoming the government decision, CREDAI Ahmedabad president Tejas Joshi said the prices of properties would rise on an “immediate basis” with charges of paid FSI rising for the developers.

“We were also looking for some concessions for old properties that are up for redevelopment,” Joshi added.