‘Hike In Ready Reckoner Rates Will Not Affect Pune Property Prices’

(DNA, Jan 2, 2011)

Experts from the housing sector feel that the rise in ready reckoner (RR) rates would not affect the property buyers much in the Pune, as the market prices are already higher than government valuation.
Experts in the real estate sector said the hike in rates would help the government to get more revenue as in some transactions, buyers and sellers show sale deeds of a minimum amount to save stamp duty.
The government has increased the RR rates by 18-20% in city from Saturday.
Every year, the government reviews the RR rates and implements the revised rate on January1.
The RR rates are used for valuation of a property to calculate minimum registration charges and stamp duty to be paid while registering the sale deed.
Advocate Sumedh Katariya told DNA that a customer will have to pay 6% (5% stamp duty and 1% registration fee) while registering the sale deed.
“While registering the property, every transaction should be either according to the RR rates or higher. It is being observed that transactions are happening at rates more than the RR rates in the city,’’ he said.
Sachin Shingav, president, Association of Real Estates Agents (AREA) said it is an exaggeration that the property prices in city are going to be dearer by 18-20%.
“The hike is only in RR rates but the market price is much higher than ready reckoner rates. Hence, it won’t have any affect on the property price,’’ he said.
Shingav said if earlier, the government valuation for a property was Rs10 lakh, it would be Rs12 lakh after the hike by 20%.
“It means that the government will get a higher registration fee since the base value is higher. It means if a customer was paying Rs60,000 as registration fee for a flat of Rs10 lakh, after 20% hike in government valuation, the buyer will have to pay Rs72,000 registration fee,’’ he said.