No Hike in Ready Reckoner Rates in Maharashtra, India

Apr 2,2019 / By Prahalad Singh / No Comment

Ready Reckoner Rates in Maharashtra:

For the 3rd year in a row, the Maharashtra Government has decided to keep the present ready reckoner rates unchanged due to slow down in the realty market. The Inspector General of Stamps and Registration Office, Pune has sent a circular to all the offices of Deputy Inspector General of Stamps and Registration Department in the State to maintain the old ready reckoner rates and register property and documents as per old rates. Though the Registrar of Stamps had suggested a nominal hike in the ready reckoner rates, the State Government issued a clear direction on it asking the authority to continue with the old ready reckoner rates.

What is ready reckoner rates?

Ready Reckoner rates are the rates of the residential, commercial or plotting property for a given area and are issued and regulated by the respective state government. These rates are regularly updated on a yearly basis depending on the plan of the government for such price changes.

The 2017-18 rates will continue to apply this financial year as well and will be effective from April 1, 2019. As a matter of fact, the earlier hike in ready reckoner rates which was even more than the existing market price of land and flats also headed to a decline in transactions. Despite the land prices saw a drop, due to the lack of buyers with deep pockets and strict norms of financial institutions to provide the easy loan to realtors, the ready reckoner rates were not changed and continued on the higher side. As a result, there was a huge demand from the realtors and developers to reduce the ready reckoner rates and bring them in a match with market facts.

According to most builders, existing rates are not as affordable as the market, It is inactive for the last two-three years. In some areas, the land and flat prices are really going down and these rates must be made more reliable. According to some property experts, linking of property purchase with Income Tax has created a problem for the buyers as they have to pay tax on the difference amount of ready reckoner rates and actual buying rates.

As per Mumbai’s leading builder/developer Hiranandani, those areas where the rates have actually fallen, builders can’t sell their flats at reduced rates since the Income Tax Act doesn’t allow any sale below 5% of the Ready Reckoner Rate for that area. Suppose, the Ready Reckoner Rate in an area is Rs 6,000 but the sale has taken place at Rs 5,500, both buyer and seller still have to pay additional tax on the Rs 500.

With relaxation in GST for affordable housing stock, reduced home loan rates, and unchanged ready reckoner rates, the property market is likely to witness some positive movement during Gudhi Padwa and Akshay Tritiya, considered as the most auspicious period for property transactions.

Revised GST rates lead to a drop in housing prices in Rajasthan

Apr 2,2019 / By Prahalad Singh / No Comment

Housing prices in Rajasthan:

The Goods and Service Tax (GST) Council in its 33rd meeting that has been conducted on 24th February 2019 has made a decision to lower the tax burden reducing GST.

Property prices, which had grown exponentially in the state, are expected to fall, as the GST council’s decision of cutting the tax rate on under-construction properties will be implemented from 1st April 2019.

On the under-construction properties, consumers will now have to pay 5% of goods and service tax (GST), as against the existing 12% while on affordable housing to 1% from the current 8%. GST council has also increased the scope of affordable housing to those costing up to Rs 45 lakh and measuring 60 sq-mt in metros and 90 sq-mt in non-metro cities.

Statistics of buying a flat after GST rate slash

In the present condition, if a buyer buys a flat worth Rs.1 crore, he has to pay approximately 18% as a tax, including registry, stamp duty, and GST, which is a huge amount. Now a buyer will have to pay Rs.5L, instead of Rs.12L as GST Tax. This could prove to be a major relief for the homebuyers.

Similarly, a buyer buying a house falling under the affordable housing scheme class will be benefited considerably too. If a flat cost is Rs.20L (under the affordable housing scheme), the buyer will have to pay Rs.20000 instead of existing Rs.36000. As the bracket of affordable housing is increased to Rs.45L in the GST Council meeting, this will also ease middle-income groups.

Homebuyers believe that this move would bring cheer for them and the Rajasthan real estate market which was facing a slowdown. At the same time, it is expected that the market will recover in the months to come.

On the other hand, the developers believe that the lower tax burden on home buyers is expected to drive demand in the affordable segment which, successively, will keep developers engaged in building more affordable homes.

The decision is expected to help the government as well constantly move towards reaching its target of ‘Housing for All 2022′. Furthermore, the move would also inspire developers to construct houses in the government’s scheme, which are not yet getting takers.

Supreme Court says buyer can’t wait endlessly for a flat on a 7-year delay

Apr 2,2019 / By Prahalad Singh / No Comment

Supreme Court decision on the delay possession:

Delay in the delivery of flat possession by the builder is an extreme and habitual problem faced by the buyers in India. Delay in the delivery of possession is when the builder does not transfer the property to the buyer within the specified time period (even after the extension period).

A property buyer, who invests his hard-earned money in buying a home and does not get its possession on time, not only leaves to get a roof over his/her head but also ends up losing money, in the form of EMIs on the home loan and paying for rented accommodation.

As a person who has paid money to a developer or builder who has then not delivered the property, you have the right to a solution to your problem. Under a new act passed by the government known as the Real Estate (Regulation and Development) Act, 2016, you have the right to file a grievance before a special body establishes for real estate projects known as the Real Estate Regulatory Authority (RERA). You can also reach consumer courts or file criminal complaints. In certain conditions, you can also start an ‘arbitration’ action or file a complaint before the Competition Commission of India.

Recently, the Supreme Court has assisted orders of a state consumer commission and the national commission to refund payment with interest to a homebuyer for over 7 years’ delay in offering possession of the flat he had booked with a Kolkata-based builder. In its judgment, the Honorable Supreme Court ordered the developer to refund the buyer.

As per the Supreme Court judgment, a buyer can’t be asked to wait endlessly for possession of his house. A period of 7 years is ahead of what is reasonable. Therefore, it would have been considered unfair to non-suit the buyer only on the basis of the first request in the relief asked before the state consumer disputes redressal commission.

A builder is also a service provider, the process of filing a consumer court complaint against them is the same as with other service providers.

Hope, this judgment will set firm arbitrary orders being passed by RERA authorities refusing refunds on their own even though RERA terms there for refunds.

Consumer redressal body directs BMC to make one free car parking compulsory in Mumbai

Apr 1,2019 / By Prahalad Singh / No Comment

To own a car has become the greatest need then the status symbol. The problem of car parking is constantly rising issue in the city of Mumbai as the numbers of cars are increasing day by day. And this increasing numbers of cars have given birth to the car parking issue in several cities.

The State Consumer Disputes Redressal Commission (SCDRC) has directed the Brihan Mumbai Municipal Corporation (BMC) to make it compulsory for builders/developers to provide one free car parking space with each apartment sold free of cost. Blog_Image Copy 3

The BMC is asked by The State Consumer Disputes Redressal Commission to amend its present Development Control Rules which currently allow a developer/builder to complete the sale of flats while providing few parking spaces. It has seen in the city that the builders charge an increased amount for the parking above the flat cost.

The commission has also mentioned a Supreme Court order which says that under the Maharashtra Ownership Flats Act (MOFA), a promoter or a builder has no right to sell any portion of a building which doesn’t come under the definition of a ‘flat’.

Calling car-parking an “essential amenity”, the SCRDC ordered the Mumbai Municipal Corporation, must take care of parking spaces while sanctioning a building plan to ensure that each flat purchaser gets one car parking space.

According to the existing Development Control (DCR) Rules in the suburbs, a builder is liable to provide only one parking space for four tenements each measuring over 35 sqm, among other terms.

The SCRDC panel also asked housing societies to frame by-laws accordingly to assure that each flat owner occupies a parking space. The panel also expressed that if car parking spaces are in excess, they can be reserved for visitors. In the case of less car parking space, by-laws should be formulated like a way that these are interchanged among flat buyers.

Builders who use part of the approved FSI to develop parking spaces will be, however, should be allowed to sell them at market rates or a high rate to new buyers.

MahaRERA decides on new SOP to remove builder for delays.

Apr 1,2019 / By Supriya Mogarala / No Comment

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MahaRERA to bring major relief for homebuyers with new Standard Operating Procedure (SOP) to remove builder for delays

Maharashtra Real Estate Regulatory Authority (MAHARERA) on Thursday issued an SOP (standard operating procedure) to permit homebuyers to remove a developer if the project is delayed. The completion of the project then would be handed over to an expert panel. The authority has made it clear that it could initiate such action only against non-litigated projects.

In case of annulment orders, the developers will lose the rights to the project his bank accounts will stay frozen adding that the authority would then set up the cabinet of experts to prepare a project report within four months to decide on future course of action then the panel would prepare a blueprint for project completion. The blueprint would consist of financial details and the particularized roadmap towards arranging the finances.

The SOP has been circulated under section 37 of the RERA Act, 2016, with reference to sections 7 and 8. MahaRERA officials said the authority will only acknowledge the complaints received from an association of allottees and not from single homebuyers for such action. They also announced that the complaints should not be less than 51% of the total allottees.

MAHARERA will serve a notice to the promoter with a 30-day deadline to showcase his case.

Monthly Archives: Apr 2019

No Hike in Ready Reckoner Rates in Maharashtra, India

Ready Reckoner Rates in Maharashtra:

Revised GST rates lead to a drop in housing prices in Rajasthan

Housing prices in Rajasthan:

Supreme Court says buyer can’t wait endlessly for a flat on a 7-year delay

Supreme Court decision on the delay possession:

Consumer redressal body directs BMC to make one free car parking compulsory in Mumbai

MahaRERA decides on new SOP to remove builder for delays.

MahaRERA to bring major relief for homebuyers with new Standard Operating Procedure (SOP) to remove builder for delays