Unscientific assessment of market value has been affecting the revenue of state exchequer.
Nellore: There is a slump in the real estate sector and it is not only due to demonetisation. The moves of the registration officials in fixing the registration value higher than the market value in some urban areas and regular hike in stamp duty is also contributing to the slump in the real estate business. For instance, the registration wing has fixed the value of one ankanam (72 sq.ft) at Rs 70,000 at Kondayapalem extension in Nellore while the current rate is only Rs 50,000 in the market. Similarly the registration value was pegged at Rs 1,08,000 for ankanam at Haranadhapuram area in the city though the market price is only around Rs 50,000 to Rs 60,000.
The government’s proposal to bring down the present stamp duty of 7.5 per cent by one per cent and increase the registration value will only contribute to further slump of the sector, according to P. Pavan Kumar, Joint General Secretary of the document writers association. He said the department’s practice of increasing registration value without any scientific assessment of market value or field inspection has been affecting the revenue of the government.
The department has not made any correction on the difference between the market value and registration value even after revenue officials told them about the variation. There is a need to reduce the registration fee and stamp duty to allow the market to revive while pointing to the threat to the livelihood of other sectors depending on real estate, he said. Registration wing officials said the registration activity dropped by 30 to 45 per cent during last two months.
They felt that the latest rule to make any payment above Rs 3 lakh by cheque in real estate transactions is also a blow to the sector. A realtor Y. Venkateswarlu of Pinakini Infra said there is no hope of recovery of the real estate in the near future and attributed this to the government’s failure to assess the impact of demonetisation on real estate sector before introduction. He said they are looking for alternate businesses for survival.
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