CHENNAI: Will the slashing of guideline value by 33 per cent reduce land prices in Chennai and result in real estate boom?
“No”, say realty experts who feel the government, while slashing guideline value by 33 per cent, has increased registration fee by three per cent, which more or less nullifies the move.
The official release said that to compensate loss of income to the State exchequer, the registration fee towards conveyance, exchange, gift and settlement would be fixed at four per cent.
The guideline values for 3.97 crore survey numbers and 1.84 lakhs streets are available in the department website www.tnreginet.net.
The latest revision, promised in AIADMK’s poll manifesto ahead of 2016 Assembly election, came after a gap of a little over five years — a considerably long period compared to the previous revisions in 2007, 2009 and last on April 1, 2012.
Confederation of Real Estate Developers president Suresh Krishn told Express that slashing of guideline value is a welcome step, but the government has increased the registration fee by 3 per cent. “The guideline value and the market value of a property is different. The move by the government could result in black money transactions,” warns K M Sadanandh, a town planer and real estate consultant.
A landowner may sell the land at market value, but then register it as per the guideline value. The difference in market value and guideline value won’t be brought into the accounts, he said.
T Chitty Babu, chairman and chief executive officer of Akshaya Private Ltd, told Express that the market value of properties across Chennai has been artificial. “We wanted the guideline value to be slashed as in many places it has been artificial. The move by the government has brought the prices back to normal,” he said. It will result in opening up of more land parcels, but the buyer would be impacted due to the hike in registration charges, he felt.
However, a former president of Builders Association of India said the hike in registration charges would cost more in transferring the sale deed in a family. “If the father wants to transfer the sale deed of Rs 10 crore worth property, he has to pay Rs 4 lakh suo moto instead of paying Rs 20,000 (the maximum for any property registered).
“It’ll be pinching those who want to settle family property in their name,” said the former chief of Builders Association, while welcoming the move by state government.
Interestingly, developers have urged the government to waive additional 3 per cent registration charge so that the real estate sector in the State benefits.