Stamp duty cut not to help realty business

The stamp duty cut on sale and purchase of flats in cooperative societies in the state budget seems to have no impact on the real estate business in the state.

The Maharashtra Budget proposed to bring down the existing 0.5 per cent duty to Rs 100 on the first Rs 2.5 lakh.

"It is not going to help anyone except in the tier IV-V cities as apart from these cities you can not buy a house under Rs 2.5 lakh," said Kumar Gera, president, Confederation of Real Estate Developers of India (CREDAI).

"In cities such as Mumbai Pune, Nashik and Nagpur, the real estate prices are going up and the duty cut offers no relief to such cities. For tier I cities the government should any duty cut below Rs 10 lakh has little significance. And for tier II towns it should be Rs 5 lakh," said Gera.

"However, the reduction in registration fee is a welcome move as it will reduce some burden of the buyer," he said.

"The proposal is not practical enough and it will not affect the business.It may benefit those who want to have low budget flats," said Jamna Das Palan, president, Builders Association,Navi Mumbai.

"These days no one constructs such low budget flats," said Anil Bagaria, realty agent. He declined the possibility going for such constructions. "Moreover, the stamp duty goes to the government. So the proposal has no meaning for the builders," Bagaria added.

"Rs 1,250 is paid as stamp duty on a purchase of Rs 2.5 lakh flat. Now it is brought down to Rs 100 -200, making a difference of around Rs 1000. How can this change affect the people who buy flats in the range of Rs 10-17 lakh?" said Bagaria.

"Now-a-days there is hardly any flat worth Rs 2.5 lakh," said Rajesh Prajapati, managing director, Prajapati Constructions.