Real Estate News: To help revive the real estate sector and reset its growth trajectory to the pre-pandemic level, the government is actively playing its part. To kickstart the ailing real estate sector and bring down the extortionate property rates, the center and state governments have been announcing major policies.
Stamp Duty Cut In Maharashtra
And in a recent move to help the immobile realty sector, the Maharashtra government, on August 26, 2020, decided to reduce the stamp duty temporarily on properties from 5% to 2% until December 31, 2020. From January 1, 2021, to March 31, 2021, the stamp duty is 3%. The real estate player welcomed the state government decision.
Stamp duty is the fee that one needs to pay while buying a new property; the state government levies this fee. A stamp duty fee makes you a legal owner of the property in its registration documents.
The reduction in the stamp duty charges helped in driving a huge property booking in Mumbai. In September, nearly 5,597 properties were registered, in October 7,929 properties, in November 9,301 properties, December saw 19,584 properties being registered, January recorded 10,412, and last month, February recorded 10,170 properties being registered, as per the government data by Inspector General of Registration (IGR) Maharashtra. Looking at the volume, they were down by 2% month-on-month but overall up 72% year-on-year, reveals the data shared by the Propstack.
Continuing the momentum, the stamp duty collection was up by 15% month-on-month but down by 19% year-on-year. However, during the festive season in October, it reached Rs 233 crore; in November, Rs 288 crore; in December, it reached Rs. 681 crore, January saw Rs. 305 crore, and in February, it was Rs. 352 crore, reveals the Propstack data.
The data shows that in February, properties worth Rs. 11,745 crore were sold, which shows the value is up by 34% year-on-year and 15% month-on-month. The total value of the properties in September was Rs. 9,025 crores, which shoots up to Rs. 11,640 crore in October, in November Rs. 14,395, Rs 34,025 crore in December; in January, it was Rs. 10,170 and stood at Rs. 11,745 crore in February, mentioned the Propstack in its data.
Sandeep Reddy, Moneycontrol, said, “March 2021 could be a bumper month for Mumbai real estate given that stamp duty would increase from 3% to 5% after March. We’re expecting the purchasing and registration behavior to be same as December 2020, where we saw a spike in registration volumes as homebuyers took advantage of the cut in the stamp duty, along with a lower home loan interest rate.”
Ashok Mohanani, President, NAREDCO, Maharashtra, said, “The consumers have grabbed the golden opportunity to purchase properties in the last few months as the bank loan interest rates are at an all-time low coupled with great property prices and reduced stamp duty benefits.”
With a lower stamp rate and lucrative discounts and deals from developers, the homebuyers are eyeing more on the luxury segment. In December 2020, as many properties worth Rs. 34,000 crore were sold only in Mumbai; and most of them being luxury properties. From bankers, industrialists, and stockbrokers were among the big ones to close the city’s real estate deals.
Ram Naik, Executive Director, The Guardians Real Estate Advisory, said in a statement that the realty sector is expecting to end this month with a registration number to range between 10,000 to 14,500, the value growth will be upward of 100 percent to 150 percent as compared to the same month last year, as the country went into lockdown last year.