The state revenue department of Maharashtra recently hiked the ready reckoner rates by an average rate of 5.86% across the state. In Mumbai, the ready reckoner rates are increased by 3.95% as opposed to 7% last year while in Pune the rate has increased by 8.5% against 11% last year. Ready reckoner rates are the minimum rate at which the sale or transfer of a plot, built-up house, apartment, or a commercial property can be registered. These rates form the basis of stamp duty and registration charge calculation for a property.
Colliers Research View
The rational for increasing ready reckoner rates is to reduce the gap between the ‘going market rate’ at which transactions are happening and the government prescribed minimum value for registration of properties. Demonetisation has adversely affected the real estate markets especially residential sector in Maharashtra. The increase in ready reckoner rates will further increase the cost of buying marginally. However, sales are unlikely to impact further as the market is primarily driven by end-users and sale transactions had already reduced to lowest in the past couple of months. Thus, we do not expect much impact on market sentiment.