No clarity yet on auction of 111 sites in southern sectors
Uncertainty looms over the planned auction of commercial and residential sites by the administration as it has failed to determine the reserve price of the properties even six months after starting the process for formulating modalities.chandigarh Updated: Dec 18, 2013 10:07 IST
Uncertainty looms over the planned auction of commercial and residential sites by the administration as it has failed to determine the reserve price of the properties even six months after starting the process for formulating modalities.
The estate office had written to the UT finance department in June for starting the process. The plan is to put 111 properties under the hammer — residential sites in Sectors 35, 37 and 40, and commercial sites in Sectors 37, 39 and 43.
The last auction in Chandigarh was held in December 2009 that saw the average price for residential sites shoot up to Rs 74,820 per square yard as against commercial site at Rs 2.74 lakh per square yard.
In 2010, the administration had planned an auction, but it was cancelled at the last moment. As a result of that delay, the administration is losing out on huge revenue.
According to senior officials, reserve price is fixed on the average of last three auctions, and the authorities have so far not been able to determine the same as no auction has taken place in a long time.
UT assistant estate officer (AEO) Rahul Gupta said they had written to finance department for finalising the modalities, but were yet to receive any response. When contacted, UT finance secretary VK Singh said work was on to determine the modalities.
Owing to high reserve prices and other factors, many commercial auctions held by the UT estate office in the past had evoked lukewarm response.
Sources said the administration was also apprehensive of holding an auction due to the slump in the realty market. To study rates prevailing in surrounding areas, the administration has conducted an exercise.
Even in the neighbouhoord, due to slump in the market, an auction conducted by the Greater Mohali Area Development Authority (GMADA) in October evoked poor response. There were no buyers for 23 residential sites put under hammer while only five commercial sites out of 28 were sold.
JK Bedi, former president of Chandigarh Property Association, said, “There is a slump in the market, and if the administration decides to conduct an auction, it is bound to fail. High collector rate is another negative factor.”