Maharashtra Cabinet Approves 50 Percent Reduction in Govt. Levies on Real Estate

The Maharashtra Government approves the proposal to cut the premium on real estate projects by half till December 21, 2021 as per the recommendation of Deepak Parekh committee. The developers availing the scheme will have to pay full stamp duty and registration charges on behalf of the homebuyers. This is the second such significant move from the government after reducing the stamp duties in the state to boost residential sales.

The premium will be calculated based on ready reckoner rates of 2019 or 2020, whichever is higher. This move will indeed support the property sector by reviving stalled projects, avoid any delays and rein in speculative price rise.

Niranjan Hiranandani, President, NAREDCO, said that this move will go a long way in expediting the project completion and the industry will witness new launches in the market. He also mentioned that the industry shall adhere to the rules laid down in lieu of availing these benefits.

Kamal Khetan, Chairman and Managing Director, Sunteck Realty Ltd said that, “The reduction in the construction premium on real estate projects by 50 percent till December 2021 is a significant decision taken by the state government to boost the real estate sector. The decision coupled with reduced stamp duty cost would help the sector to witness accelerated sales due to the feasible home prices in the upcoming time. It would incentivize the purchasing decision of the homebuyers and boost the residential real estate demand.”

This decision is expected to impact big cities of the state as nearly one-third of a project’s cost goes towards over 22 premiums collected in the country’s most expensive realty market, which is significantly higher than any other top cities including Bangalore.

The zero stamp duty burden on homebuyers will help the property market maintain the buoyancy it has been witnessing since the last few months following the announcement of reduction of stamp duty charges.

The premium reduction coupled with the stamp duty charges which will also be borne by the developers, will lead to reduced cost for homebuyers thereby increasing their purchasing power, said Deepak Goradia, President of CREDAI-MCHI. He added that this move will help bolster the state’s economy.