New Karnataka Budget to Cheer Up Home Buyers

Bangalore: Home buyers are in buoyant mood as Karnataka state budget has reduced stamp duty on  sale deeds by 5 percent from 6 percent, while, the registration charges remains the same by 1 percent. Lately, home buyers were facing the heat due to high interest rates and levy charges, and with this new Karnataka budget the government has brought some relief to home buyers, reports Times of India.

Irfan Razack, CMD, Prestige Group cited that “Reducing the stamp duty will make the product more affordable especially in today’s high inflationary scenario. The move is in line with the JNNURM directive to state governments to maintain uniformity in stamp duty,” reports TOI.

J C Sharma, MD, Sobha Developers stated that “This is a progressive step” and the state government’s move is to encourage home buyers who are waiting to get some relaxation on home buying. However, the real estate market of Bangalore is witnessing good property sales compared to other metros in the Q2 and Q3 of 2011, although during the Q4, the sales market showed slow movements. According to real estate consultancy Jones Lang LaSalle India’s report, Bangalore’s real estate market has observed 3370 units of absorption in the Q4 compared to 3743 units in the Q3.

However in addition, the budget has also stated the reduction on stamp duty charges from 6 percent to 1 percent on the market value of the property in joint development agreement and power of attorney category. On this context, Sharma cited that “The state saw fewer joint development agreements last year because of high stamp duty. This move will revive joint development agreements.”

Ravindra Pai, MD, Century Real Estate stated that people who have bagged joint development agreement can now execute their projects, which they had put on hold due to soaring transaction cost.