Customers now have to pay about Rs 74,000 more depending on the property’s market value to register their sale deeds.
To support its dwindling income, the state government increased the property registration fee from 0.5% to 1% in the affordable segment from 50 to 75 lakhs. A notice issued by the law department requires home buyers to pay 3% of the property’s market value. The buyers have to pay when registering the purchase, where the property value is not more than 75 lakhs.
Currently, the registration fee for up to 50 lakhs is 2% and over 50 lakhs, and up to 75 lakhs is about 2.5%. State government sources said this was done to optimize registration fees. However, according to Credai it would have a big impact on sales.
Only exemption in property registration will create demand
The decision from the state government came at a time when the real estate sector was facing a sharp decline in demand for apartments and flats. Builders and developers in the state want the government to lower registration fees. If possible, even lower stamp duty to increase property sales.
Builders, led by Credai, will meet with the law minister and submit a representation and try to convince authorities to cancel the announcement. Credai will try to convince by stating the example of Maharashtra, which briefly lowered registration fees to stimulate demand.
Covid-19 has hit the real estate sector a devastating blow as apartments and houses become more expensive and delayed. Credai’s investigation showed that this had an impact on construction activity and that buyers delayed purchases due to the second wave.
The developers estimate that exemption on stamp duty or reduction of registration fees can help in creating demand.
The decision will spoil the market
Nilesh Salkar, Credai, Goa President said, the hike in property registration is counterproductive and completely unexpected for us. The government believes it can absorb the revenue. But a well known fact that lower the taxes, higher will be the revenue. This step will definitely affect the real estate sector and ruin the market for some upcoming years.
In simple terms this fee increment means that customers buying an apartment under 75 lakh have to pay an additional 1% for registration.