In a move that will further raise the already exorbitant real estate prices in the city, the state has hiked ready reckoner rates for both residential and commercial properties by 5% to 25%, with effect from January 1.
The ready reckoner is used to calculate the market value of a property.
This means Mumbaiites will now have to pay more stamp duty to register the property they buy. Builders will also have to pay higher premiums on the land they purchase – these are calculated based on ready reckoner rates – to the state, which they will pass on to the buyers.
Stamp duty is 5% of the total property value, based on rates in the ready reckoner.
“It is unfortunate that when homebuyers need relief, they are burdened with more taxes,” said Vinod Sampat, lawyer and president of the Cooperative Societies Residents, Users and Welfare Association.
“It looks like the builders and the government are only interested in increasing their income; they don’t care for the common man,” said Shekhar Chilivery, who lives in Worli chawl.
High realty rates, tougher lending norms and the hike in home loan interest rates have caused property sales in the city to plummet. This will worsen the situation.
“This will hurt the real estate business further,” said Lalit Kumar Jain, president, Confederation of Real Estate Developers Association of India, one of the industry’s apex bodies.
Sandeep Runwal, director of Runwal Group, said: “This will hike the premium we pay and will add to the project cost.”