January 20, 2021

CREDAI Bengal Daily News Update | 20.01.21

ICRA expects recovery in housing demand to continue due to

improved affordability

Repo-linked lending rate (RLLR) for home loans have touched a historical low, with the

rates dropping below 7%. Banks are also offering discounts on processing fees etc.

Housing affordability in India has historically been low, with unit pricing remaining high due to

rising land costs, zoning and floor indices-based restrictions, and high transaction costs and taxes.

In recent years though, the government has been taking steps towards moderating real estate

transaction/finance costs and taxes, through measures such as higher income tax incentives for

first time buyers in the form of housing loan interest deduction, credit-linked subsidy schemes

under PMAY for purchases in the affordable and mid segments, etc.

Post the onset of covid-19, a steep reduction in home loan rates, together with other state and

central government incentives, has further supported affordability and in turn, housing demand,

thereby stimulating some recovery from post-covid lows, said ICRA Ratings, a rating agency.

Housing sales volumes, which had declined by 62% year-on-year in Q1 FY2021, bounced back

considerably in subsequent quarters, with a quarter-on-quarter growth of 60% in Q2 FY2021 and

further quarter-on-quarter growth of 53% in Q3 FY2021, limiting the year-on-year dip to 7% in

Q3 FY2021, according to the rating agency.

Shubham Jain, senior vice president and group head, ICRA, said, "In recent quarters reduced

home loan rates, attractive payment schemes/discounts and reduction of stamp duties in certain

key states on the back of Covid-19, has significantly brought down housing costs and stimulated

housing demand.”

Repo-linked lending rate (RLLR) for home loans have touched a historical low, with the rates

dropping below 7%. Banks are also offering discounts on processing fees etc.

Given the prevailing economic uncertainties, repo rates are likely to remain low over the near-to-

medium term, and thus home buyers may continue to benefit from the same into FY2022.

Certain states, i.e. – Maharashtra and Karnataka have extended 2-3% reductions in stamp duty

for a limited time, which has spurred housing registrations to reach all-time highs in some areas.

The Maharashtra government has also reduced construction premiums for developers by 50% up

till December 2021, and in turn, has required the developers availing of this scheme to pay stamp

Newspaper/Online ET Realty ( online )

Date January 20, 2020

Link

https://realty.economictimes.indiatimes.com/news/residential/icra-expects-recovery-in-housing-demand-to-continue-due-to-improved-affordability/80358351

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duty on behalf of the buyers, which is expected to further boost demand in the region.

“A focused attempt to address affordability through reduced housing costs for the home-buyer

would allow for the recent demand uptick to continue, and thereby enable the recovery of housing

demand to pre-Covid levels within FY2022," added Jain.

The upcoming budget 2021 may also add a stimulus by increasing income tax deductions and

relaxing some of the caps currently applied.

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Over 46,000 buyers register for Delhi Development Authority

housing scheme

The scheme offers 254 higher income group (HIG) flats with prices ranging between Rs 69.6

lakh and Rs 2.1 crore and 757 two-bedroom middle income group (MIG) flats priced

between Rs 40.6 lakh and Rs 1.4 crore.

Around 46,500 home aspirants have registered for Delhi Development Authority’s Housing

Scheme 2021 and more than 10,000 have already applied for the 1,354, mostly two- and three-

bedroom, flats on offer.

The scheme was launched on January 2 and saw DDA’s website getting nearly 10 lakh hits on

Day 1 itself. It offers 254 higher income group (HIG) flats with prices ranging between Rs 69.6

lakh and Rs 2.1 crore and 757 two-bedroom middle income group (MIG) flats priced between Rs

40.6 lakh and Rs 1.4 crore. The number of one-bedroom flats is on the lower side, with just 52

lower income group (LIG) flats with the price tags of Rs 17.7 to Rs 35.5 lakh, besides 291 flats

for the economically weaker section (EWS).

Home-seekers can apply till February 16 and the draw of lots is expected by the first week of

March. While 8,550 home seekers have submitted their applications, 2,325 applicants have even

Newspaper/Online ET Realty ( online )

Date January 20, 2020

Link

https://realty.economictimes.indiatimes.com/news/residential/over-46000-buyers-register-for-delhi-development-authority-housing-scheme/80358841

https://realty.economictimes.indiatimes.com/tag/delhi+development+authorityhttps://realty.economictimes.indiatimes.com/tag/ddahttps://realty.economictimes.indiatimes.com/news/residential/over-46000-buyers-register-for-delhi-development-authority-housing-scheme/80358841https://realty.economictimes.indiatimes.com/news/residential/over-46000-buyers-register-for-delhi-development-authority-housing-scheme/80358841https://realty.economictimes.indiatimes.com/news/residential/over-46000-buyers-register-for-delhi-development-authority-housing-scheme/80358841

paid the application money, which ranges from Rs 2 lakh for HIG and MIG to Rs 1 lakh for LIG

and Rs 25,000 for EWS flats.

“We are satisfied with the response, which is as per our expectations. Most people are applying

for flats under HIG and MIG categories,” a senior DDA official said.

“What has made this scheme more attractive is the construction quality, which is at par with the

best private developers, apart from the excellent locations of all complexes where flats are on

offer, including those in Jasola, Dwarka and Vasant Kunj,” he added. “Not only are the complexes

well located, these are also in close proximity to Delhi Metro corridors.”

For its 2019 housing scheme, DDA had received around 45,000 applications for the nearly 18,000

flats on offer. However, a huge number of these flats were in the LIG category and many were

located in Narela. With a large number of these flats not finding any takers, DDA finally carried

out a draw of lots for around 10,000 flats.

Keeping its previous experience in mind, DDA had decided to keep one-bedroom flats to a

minimum and only around 140 flats of various categories in the scheme this time are old, unsold

flats.

“The total number of applications may seem low at the moment compared to our previous

schemes, but it is not unusual during the first few weeks after the launch of a scheme. We know

through experience that the rush of applications suddenly peaks just a few days before the closing

date,” the official said.

________________________________________________________________

CREDAI urges Uttar Pradesh government to reduce stamp duty &

registration fees

The members of CREDAI Western UP apprised the Minister that the state government

revised registration fee of property in the state 1% of property cost from February 2019

which was earlier only 20,000 fixed.

CREDAI Western UP, an association of real estate developers, has urged the state government

to reduce stamp duty and registration fees to make property purchase affordable post Covid-19

in Uttar Pradesh, it said in a media release.

The association on Tuesday met Ravindra Jaiswal, Minister of State (Independent Charge)-

Stamp Duty, Court Fee and Registration-Uttar Pradesh and Dr. Mahesh Sharma - Member of Lok

Sabha - Gautam Buddha Nagar and handed over a written memorandum.

Prashant Tiwari, president, CREDAI Western said, "If the registration fee is reduced to the

minimum at the time of agreement to sub-lease, the property registry will increase and state

revenue will go up. We have urged to reduce stamp duty for the next 6 to 12 months to speed up

the purchase and sale of property after the coronavirus pandemic."

The members of CREDAI Western UP apprised the Minister that the state government revised

registration fee of property in the state 1% of property cost from February 2019 which was earlier

only 20,000 fixed.

"It is essential to register the agreement but paying 1% fee is a big issue for any buyer as the

average price of the property has gone up to 40 - 50 lakhs. In such a situation, we are requesting

state govt to reduce stamp duty and charge a minimum fee for registration of agreement to sub-

lease." Subodh Goya, secretary, Credai Western UP.

After the implementation of UP-RERA, registration of the builder-buyer agreement/agreement to

sub-lease has also been made mandatory. Apart from this, the home buyers are paying stamp duty

of 5%.

In this way, the home buyer has to pay a 1% registration fee of the same property at the time of

agreement to sub-lease and final sale deed both. So the home buyer has to bear the burden of 7%

by adding the registration fee twice and stamp duty once for the same house, which prevents the

home buyer from registering the agreement, said the association.

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date January 20, 2020

Link

https://realty.economictimes.indiatimes.com/news/industry/credai-urges-uttar-pradesh-government-to-reduce-stamp-duty-registration-fees/80358004

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_________________________________________________________

Newspaper/Online The Telegraph

Date January 20, 2020

Gurugram: Now submit objections to proposed circle rates' hike by

January 25

The circle rate or collector’s rate is the minimum value that state governments have set for

the sale or transfer of a plot, built-up house, apartment or commercial property.

The deadline to submit objections and suggestions to the proposed hike in circle

rates in Gurgaon for the 2021-22 fiscal has been extended to January 25, officials said. Earlier,

the deadline was January 15.

The decision to extend the deadline by 10 days was taken by Sanjeev Kaushal, additional chief

secretary and financial commissioner of Haryana’s revenue and disaster management department,

after he held a virtual meeting with the deputy commissioners of all districts on Monday.

The circle rate or collector’s rate is the minimum value that state governments have set for the

sale or transfer of a plot, built-up house, apartment or commercial property.

Officials said that Kaushal had sought a report on the feedback on circle rates from the deputy

commissioners. At the meeting, Gurgaon’s deputy commissioner Yash Garg said that the district

has received only eight suggestions and objections so far from the public.

“The objections and suggestions can now be submitted till January 25. We have received a mixed

response from the public. While some are happy with the proposed circle rates, some have raised

objections stating that homebuyers would suffer due to the hike in circle rates,” said Basti Ram,

district revenue officer.

After the deadline of January 25 is over, “we will take one month to finalise the circle rates”, the

district revenue officer added.

The new circle rates for the 2021-22 fiscal year will be implemented from April 1. Committees

at the tehsil level were formed on the directions of the state government to decide the circle rates.

The circle rates proposed by each of these committees have been uploaded on the website of the

district administration.

Gurgaon’s home developers association had also met the deputy commissioner on January 12 and

demanded at least a 10% decrease in circle rates to boost the real estate market struggling due to

pandemic.

Newspaper/Online ET Realty ( online )

Date January 19, 2020

Link

https://realty.economictimes.indiatimes.com/news/industry/gurugram-now-submit-objections-to-proposed-circle-rates-hike-by-january-25/80341094

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Moreover, the association had also submitted a representation that the proposed circle rate for

builder floors should be rolled back. The existing circle rate of builder floor is Rs 5,500 per sq ft

and the proposed rate is Rs 6,500 per sq ft.

________________________________________________________________

Noida allows builders to pay lease rent instalments, nearly 30,000

buyers can register properties

The Noida Authority on January 18 allowed private developers to pay lease rent dues in

instalments. The move will help around 30,000 homebuyers who are waiting to get their

properties registered.

According to a rough estimate, there are close to 50 highrise projects in the city where around

30,000 buyers have not been able to register their flats because the developers have not cleared

dues of the Authority. A number of these buyers had approached the UP government, urging it to

find a solution.

The decision to allow builders to pay in instalments was taken at the board meeting of the

Authority. It, however, comes with a few riders. For instance, builders will be considered for the

instalment scheme only if they have cleared the land premium. They will also have to pay the

prevailing interest rate being charged by the Authority.

RK Arora, President of UP Naredco, a real estate body, backed the decision. "We welcome the

decision and will urge developers to take advantage of the scheme at the earliest. Although lease

rent amounts to 15% of the overall dues, it is the most burning issue among buyers, builders and

the industrial development authorities in the district at present. Registries cannot be executed

without it," he added.

As part of the scheme, the application of a group housing project in Sector 75 will be processed

first. This will pave the way for 618 buyers to register their flats.

After the developer has paid an instalment and cleared the premium, a meeting will be held with

Authority officials and buyers. The registries will be done in proportion to the amount that has

been cleared. "We will divide the total amount due with the number of flats that are to be

registered. For instance, if the builder has paid 25% of the dues, 22.5% of the total inventory can

be registered. We will keep 10% of the inventory on hold till the last instalment is cleared," said

an official of the group housing section.

Jitendra Kumar, who had bought a flat in Mahagun Moderne in Sector 78, is also awaiting

registry. "I had bought a 2BHK in Verona tower in August 2017 and paid about Rs 80 lakh to the

builder. It included both the cost of the flat and the registry charges. The final papers to execute

the registry were prepared in November 2018. However, even after two years, the registry has not

Newspaper/Online The Times Of India ( online )

Date January 19, 2020

Link

https://content.magicbricks.com/property-news/delhi-ncr-real-estate-news/noida-allows-builders-to-pay-lease-rent-instalments-nearly-30000-buyers-can-register-properties/118640.html

https://content.magicbricks.com/property-news/delhi-ncr-real-estate-news/noida-allows-builders-to-pay-lease-rent-instalments-nearly-30000-buyers-can-register-properties/118640.htmlhttps://content.magicbricks.com/property-news/delhi-ncr-real-estate-news/noida-allows-builders-to-pay-lease-rent-instalments-nearly-30000-buyers-can-register-properties/118640.htmlhttps://content.magicbricks.com/property-news/delhi-ncr-real-estate-news/noida-allows-builders-to-pay-lease-rent-instalments-nearly-30000-buyers-can-register-properties/118640.html

been done. Noida Authority officials said the developer was yet to settle dues. More than 250 flat

buyers like me are waiting for registry even after paying the entire amount," he added.

Among other decisions taken at the board meeting, the Authority said the applications of big

ticket investors would be fast-tracked and processed within 15 days. For this, the minimum worth

of the project will have to be Rs 200 crore. Such companies will have to also invest Rs 7 crore

per acre in order to create more job opportunities.

________________________________________________________________________

Act firm on illegal buildings on government land: Madras HC

The judges observed that a loud and clear message has to be sent to the local people or

political big shots that they cannot put up unauthorised constructions in revenue or public

land across the state.

The state government has to have a sense of discipline and uniformly demolish all unauthorised

structures in revenue and public land, the Madras high court has said, and asked the government

to submit a comprehensive report on a plea seeking to remove unauthorised statues in public

places and road margins across the state.

A division bench of Chief Justice Sanjib Banerjee and justice M M Sundresh observed that

unauthorised constructions, including religious or political statues are springing up in the revenue

land parcels in the state.

The judges observed that a loud and clear message has to be sent to the local people or political

big shots that they cannot put up unauthorised constructions in revenue or public land across the

state.

The judges further observed that before putting up any statue proper permission should be

obtained from the authorities concerned. The judges asked the government to take a

comprehensive view in this matter and sought a report in this regard.

The court was hearing a public interest litigation filed by V Vaira Sekar, a resident of Thanjavur

district on Monday. The petitioner stated that such unauthorised statues which are situated in the

public places and road margins also causes traffic congestion and cause hindrance to the people.

________________________________________________________________

Newspaper/Online The Times Of India ( online )

Date January 19, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/act-firm-on-illegal-buildings-on-government-land-madras-hc/80347085

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Act against those who have Rs 1 lakh property tax dues: Nashik

municipal commissioner

Jadhav has also set the target of recovering 50% of the property tax dues and 75% of the

target revenue collection set for this financial year by the end of the current fiscal.

Commissioner of Nashik Municipal Corporation (NMC) Kailas Jadhav on Monday directed

officials to take action against defaulters who have dues over Rs 1 lakh in property and water

taxes.

Jadhav has also set the target of recovering 50% of the property tax dues and 75% of the target

revenue collection set for this financial year by the end of the current fiscal. The directive of the

civic chief comes in the wake of the drop in the NMC’s revenue collection that has been hit

following the Covid-19 outbreak.

“There are 238 water tax defaulters who have dues over Rs 1 lakh. These defaulters altogether

have water tax dues amounting to Rs 10 crore. I have directed the officials to recover at least Rs

8 crore from them,” said Jadhav.

Moreover, there are over 3,700 defaulters who have property tax dues of over Rs 1 lakh. So far,

the NMC has collected Rs 82 crore as property tax in the current fiscal compared to Rs 110 crore

collected during the corresponding period last year.

Of the Rs 132 crore-target set as revenue collection from water taxes for this fiscal, the NMC has

managed to collect only Rs 25 crore so far.

________________________________________________________________

Newspaper/Online The Times Of India ( online )

Date January 19, 2020

Link

https://realty.economictimes.indiatimes.com/news/regulatory/act-against-those-who-have-rs-1-lakh-property-tax-dues-nashik-municipal-commissioner/80346802

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