In an attempt to push real estate activity further, The Ministry of Housing and Urban affairs has recommended property stamp duty reduction. This attempt is expected to not just generate more revenue but also bolster economic growth. That's the outcome Durga Shankar Mishra, Secretary, Minister of Housing affairs is anticipating.
Land is a state subject and however, the decision on stamp duty reduction lies with the state government, but some governments have already expressed their interest and favour in continuing it further since this move has resulted in higher property sales as well increased registration activity.
Maharashtra too for instance has reduced stamp duty from 5% to 2% and to 3% for December end and January-March 2021 respectively.
Karnataka is another such state to reduce stamp duty from 5% to 3% for properties priced between INR 21 lakh and Rs 35 lakh.
Mishra has spoken a great deal about the significance of the need of supporting the sector in a current scenario in a realty conference to the developers at NAREDCO-APREA. He highlights that this sector contributes around 7% to the GDP of India and he hopes to raise it up to 14-15% in the future. Around 5.5 crore people are currently involved in the real estate sector.
Mumbai currently holds the domineering status of being the most expensive property market in India and residential sales there significantly increased upto 36% in October month and clearly surpassed the pre COVID'19 level. It is also prompted by stamp duty reduction by Maharashtra government and the discounts offered by real estate developers.
October has reportedly witnessed the fourth-highest monthly sales in registration volume and values since April 2013.
Government is also reportedly prepared with the model Tenancy law that would bolster rental housing across the country. The law has also been translated in various regional languages and now ministry is waiting to receive the feedback on the same from other states and general public.
As per the current status, more than one crore houses are vacant at present in the country as many owners are sceptical on renting them out.
Approved in July, The Affordable Rental Housing Complex (ARHCs) scheme was launched under Pradhan Mantri Awas Yojana to provide budgeted and economical options for rental accommodation to poor and migrant workers in urban areas. This is estimated to benefit more than 3,50,000 people.
24 states and Union territories have already signed their agreements in lieu of the guidelines issued by the government for this scheme. This scheme has reportedly garnered good response in key cities such as Chandigarh, Surat, Jaipur, Baroda, Bengaluru and Bahadurgarh and 3 private entities have offered to build around 2800 such houses.
This sçheme is also offering great incentives such as free floor space index, free-of-cost trunk infrastructure facilities and concessional project finance to push the participation.