Earlier in August 2020, Maharashtra government slashed the stamp duty on sale deed documents from 5 per cent to 2 per cent involving September 1 and December 31, 2020

Realty stocks surged on Thursday right after the Maharashtra government cleared a proposal to reduce levies on genuine estate by 50 per cent till December 2021. Nifty Realty index also jumped more than 3.5 per cent, with Oberoi Realty and Godrej Properties shares hitting their respective 52-week highs. Until now 22 premiums had been collected in Mumbai beneath many heads such as floor space index (FSI), staircase, lobbies and so forth. According to the professionals, the selection to slash premium is most likely to provide impetus to the genuine estate market in Maharashtra. “After the stamp duty cut, Naredco Maharashtra welcomes the decision of the Maharashtra government to reduce the construction premium by 50%. It will give a big respite to the developers, as the cost of the premium, as well as approval cost, contribute 35 to 38% of the project cost, whereby the project cost will come down substantially,” stated Ashok Mohanani, President, NAREDCO Maharashtra.

Also study: Maharashtra cuts levies on genuine estate developers by 50%

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Earlier in August 2020, Maharashtra government slashed the stamp duty on sale deed documents from 5 per cent to 2 per cent involving September 1 and December 31, 2020. Today, Indiabulls Real Estate share value soared 11.5 per cent to Rs 87.4 apiece, although Sobha Limited shares jumped 7.4 per cent in the trade. Mohanani added that larger premiums place more economic burden on developers top to larger fees for the homebuyers.

Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory stated that the selection to reduce premiums by 50 per cent is most likely to propel developers to supply extended payment holidays and also give profitable value proposals to purchasers in projects exactly where the inventory has been promoting gradually.

Besides, according to the Knight Frank India report released yesterday for July-December 2020, genuine estate across India’s major eight cities has grow to be more very affordable with house costs correcting up to 9 per cent and interest prices falling to multi-decade lows. Meanwhile, sales in the major eight cities enhanced 60 per cent through the period as compared to the very first half of final year, with sales of 94,997 units.

Shishir Baijal, Chairman and Managing Director, Knight Frank India stated following the suggestions of the Parekh Committee, the reduce of 50 per cent on premiums on genuine estate projects will assistance the provide side to stabilise and make improvement in the state more feasible. Baijal added that this reduction in premiums, coupled with the revision in stamp duty (that has helped catapult demand) will make genuine estate improvement in the state profitable.

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