Delhi govt cuts real estate circle rates
In a major relief for homebuyers and a big boost for the real estate industry, the Delhi government has decided to slash circle rates for commercial, residential and industrial properties in Delhi by a flat 20% until the end of September 2021.
A cabinet chaired by Chief Minister Arvind Kejriwal finalised the decision.
Officials said that circle rates related to commercial, residential, and industrial properties in Delhi have been reduced by a flat 20% across all categories of colonies and areas till 30 September 2021.
Industry experts welcomed the decision, saying that the reduction by 20% will motivate the fence-sitter buyers to make quick decisions. Real estate experts said that the decision might also lead to revved up property transactions, especially in Grade A micro-markets, where there is a mismatch in circle rate and market rate.
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Higher circle rates are generally assigned to commercial properties by the government and lower rates for residential properties. The type of property also affects the circle rates. The registration value of apartments in Delhi are different from those of plots and independent houses even within the same area.
Delhi has witnessed one of the biggest increases in real estate demand in the country. As we reported, sales went up 43% from Q3 to Q4 FY2020 following, among other seasonal factors, incentives and new launches.
Leading up the Union Budget 2021-22 announcements on February 1, the real estate industry and related associations had sought several steps to reduce the burden on both the industry and the consumer. Real estate, buoyed by a surprising spurt among both domestic and international consumers during the pandemic months, has proved to be a beacon of hope for the overall economy to emerge healthier out of the Covid-19 shadows.
The real estate industry has used that sectoral leadership to ask for further measures to see the industry through. In January, NAREDCO had asked for more stress funds to help tide over the crisis. As per a study by Anarock Property Consultants, affordable housing already accounts for more than 35% of the supply across the top seven cities in the country.
Image: Reduction of circle rates by 20% comes in the already buoyant real estate demand in the National Capital Region.
Also read: Budget expectations in real estate sector