'Hike in stamp duty, property registration charges will impact home buyers'
The government has increased stamp duty charges from a fixed amount to 1 per cent of the market value of the property, while registration charges for construction agreements have increased from one per cent to three per cent effective immediately from July 10th.
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CHENNAI: Confederation of Real Estate Developers' Associations of India (CREDAI) on Tuesday said that the state government's recent announcement on increasing the stamp duty and property registration charges has impacted home buyers putting a strain on the affordability and accessibility of housing and sought reduction of the hike.
The government has increased stamp duty charges from a fixed amount to 1 per cent of the market value of the property, while registration charges for construction agreements have increased from one per cent to three per cent effective immediately from July 10th.
"The sudden increase has created a significant financial burden for home buyers, forcing them to pay the additional amount from their own funds as leading banks are not prepared to provide immediate support for the increased registration charges. As a result, property registrations have been delayed, affecting both under-construction and ready-to-occupy projects, " S Sivagurunathan, President, CREDAI-Chennai told reporters here.
S Sridharan, Vice President, CREDAI National South Zone, said, reducing the charges to a nominal level will alleviate the financial burden on home buyers, promote the redevelopment of apartments, and encourage new home buyers to invest in properties.
R Elangovan, president, CREDAI-Tamil Nadu, said that first-time home buyers, in particular, may face challenges due to this increase, affecting their purchasing power. "An average middle-class family buying an apartment worth Rs 50 lakh will now be required to pay an additional Rs 1 lakh. This increased cost will influence the decision-making process for prospective home buyers, " it added.
"Redevelopment projects with multiple units will also be severely affected by this increase. The cost of registering the powers of attorney will increase significantly, leading to higher selling prices for buildings and putting additional financial pressure on home buyers, especially those from the middle-class and lower-middle-class segments, " said AN Balaji, Chairman, Builders Association of India.
