Delhi Circle Rates May Be Hiked In Near Future

We all are aware of the fact that the economic slowdown has affected the businesses in India a lot. Now, the ghost of the slowdown has started haunting the Delhi government as well. According to the latest review of the condition of the state public revenues, which is led by chief secretary P.K. Tripathi, the government is quite worried about the realty sector of the country. The collections in the third quarter of the current fiscal year have been quite disappointing. The target was set at Rs 28,000 crore and the government was able to achieve only 40% of the overambitious target. As a result of the latest developments, the buyers should expect an increase in the circle rates of the properties in Delhi.

This has been quite a bad quarter for the government, and the collection of the revenues from value added taxes (VAT) and property registration from commercial real estate and residential real estate have been targeted as the top most areas. Overall, the expenditure for the current year stands at 31% of the total revenues of the current fiscal year. However, the data is higher if we compare the same to the previous year, which stood at around 26%. Still, the government is expecting more and is looking forward to strengthen its resources, which can fetch more profits. 

The most disappointing has been the VAT section, which was only able to meet 50% of the target set by the government, as quoted by the chief secretary. Other sectors that have also not shown any positive trend have been collections from stamp duty and registration of property and other documents.

One of the main reasons for such a condition has been the sluggish market, which has prevented many buyers to make investments. The investors and buyers have refrained a lot from the market, seeing the increased prices and low return on investments and the situation has been worsened by the inflation, which has risen to new levels. In addition, government imposed several restrictions on the registration of new properties, and because of this, less people show their willingness or came forward to register their properties.

To improve the stamp duty collections, the suggestive steps may be the revision of the circle rates at the earliest, so that a positive trend can be observed. As per the current scenario, the current market rates are not at par with the general prices of the properties in the posh localities of Delhi, such as Hauz Khas, Greater Kailash, Maharani Bagh, Alaknanda, Vasant Vihar, Defence Colony, Jor Bagh, New Friends Colony, Golf Links, Green Park, etc. It is being speculated that the process of revising the circle rates will soon be accomplished and will be presented before the cabinet, before the economic slowdown could hamper the real estate market of Delhi. It would be a great idea to wait until the cabinet passes any rule regarding the buy and sale of the property, so that one can earn benefits according to the standards set by the realty market.