Trans­ac­tions increased in North West Delhi before hike
Source: Indian Express
Dated: 28^th June 10

Revised circle rates: Prop­erty trans­ac­tions register up to 25 pc increase as circle rates set to go up to thrice the exist­ing value
With the Delhi gov­ern­ment yet to form­ally notify the new circle rates announced on June 14, the Capital’s real estate mar­ket has been busy push­ing through deals and regis­ter­ing them over the last fortnight.

The new rates are at least three times the exist­ing ones, and as a res­ult the num­ber of doc­u­ments received by sub-registrars across Delhi has registered a 20 – 25 per cent jump, said Rev­enue depart­ment offi­cials. “We haven’t form­ally tab­u­lated the trans­ac­tions so far, but there are reports of an increase in the num­ber of trans­ac­tions in anti­cip­a­tion of the hike,” said Prin­cipal Sec­ret­ary, Rev­enue, D M Spolia.

The max­imum increase has been repor­ted from mid-income areas in North­w­est Delhi and West Delhi, offi­cials said. These include areas like Narela, Rohini, Mon­golpuri, Saraswati Vihar and Model Town in North­w­est Delhi and Mansaro­var Garden and major com­mer­cial and res­id­en­tial areas like Jana­kpuri and Tilak Nagar in West Delhi. Till the new rates come into force some­time next month, trans­ac­tions are being done accord­ing to the struc­ture intro­duced in 2007.

The exist­ing circle rates — the min­imum amount at which a prop­erty is val­ued and sold — were fixed accord­ing to the cat­egor­ies defined by the Muni­cipal Cor­por­a­tion of Delhi for col­lect­ing prop­erty tax. “But we real­ised that there was a dif­fer­ence of 1,000 per cent in the mar­ket value and the circle rates fixed by us in some cases. The exist­ing rates reflec­ted only 30 – 40 per cent of the actual mar­ket value,” Spo­lia added. As part of a sur­vey con­duc­ted last year, the Rev­enue depart­ment found that the circle rates for built up flats in areas like Vas­ant Kunj and Friends Colony were almost the same as those in Govindpuri.

In a bid to reduce this dis­crep­ancy between the actual mar­ket price of a prop­erty and the exist­ing circle rates, the gov­ern­ment announced a new policy earlier this month. In the new scheme, Defence Colony, Greater Kailash, Gul­mo­har Park, Panch­sheel Enclave, Green Park and Hauz Khas that fall under Cat­egory A for prop­erty tax col­lec­tion, will register a 300 per cent increase in circle rates. The rates have been revised from the exist­ing Rs 43,000 to Rs 1.25 lakh per square metre in these South Delhi colonies.

While the gov­ern­ment has done away with the cat­egor­ies defined by the MCD, it has defined new slabs and cat­egor­ised Delhi’s 2,480 colon­ies under those slabs tak­ing into account factors like infra­struc­ture avail­ab­il­ity and civic facil­it­ies. With the new rates, the gov­ern­ment is expect­ing a 35 per cent jump in rev­enue gen­er­a­tion, adding another Rs 400 crore to its cof­fers. The cur­rent sys­tem gen­er­ates a rev­enue of about Rs 940 crore annu­ally, said the offi­cials said.

“We are def­in­itely expect­ing an increase in rev­enue, but this also depends on the way the mar­ket behaves,” Spo­lia cau­tions. The slump in 2008-09 had affected rev­enue gen­er­a­tion, with the gov­ern­ment tak­ing in just Rs 786.86 crore.

TRENDS BEFORE THE HIKE

Prop­er­ties under cat­egor­ies D, E, F and G have most trans­ac­tions. Most of these are in colon­ies of loc­al­it­ies like Karala, Najafgarh, Sul­tan­pur Majra, Khirki Exten­sion, Jana­kpuri, Uttam Nagar, Bur­ari and Chattarpur.

In Janu­ary 2009 E Cat­egory prop­er­ties had the highest num­ber of deal­ings in North­w­est Delhi, with 1,080 trans­ac­tions. This increased to 1,768 trans­ac­tions in Janu­ary 2010 con­sti­tut­ing 25.07 per cent of all doc­u­ments registered.

Prop­er­ties in cat­egory A, B, C and H have fewer trans­ac­tions in. In Janu­ary 2010, colon­ies in Cat­egory A recor­ded only 1.55 per cent of registered doc­u­ments. These include areas like Defence Colony, Vas­ant Vihar and Gul­mo­har Park. Cat­egory B and C include areas like GK, Kailash Colony, Vas­ant Kunj and Patel Nagar. Cat­egory H (2.42 per cent) con­sists of unau­thor­ised colonies.