With Circle Rate Hike, Property Prices In Ghaziabad Set To Shoot Up

The move would certainly cause more fluttering as far as developers' nervous are concerned. Effective from April 1, circle rates for various sectors of Ghaziabad's Vasundhara have been raised by 16 per cent.

For the uninitiated, circle rates, also known as ready reckoner rates, are the lowest permissible rate at which a property can be registered across Indian states. These rates vary from state to state and are subject to revision from time to time. Based on the circle rates, buyers have to pay the stamp duty, registration charges and other taxes on their property purchase. In simple words, a hike in circle rates amounts to properties becoming costlier.

The Uttar Pradesh Housing Board recently decided to hike circle rates across many cities, including state capital Lucknow. For Vasundhara, circle rates have been increased from the earlier Rs 42,000 per square metre (sqm) to Rs 48,800 per sqm for even-numbered sectors while rates are hiked from the earlier Rs 38,000 per sqm to Rs 44,100 per sqm for odd-number sectors. These rates are applicable on the residential property transactions.

For commercial plots in even-numbered sectors, you now have to pay Rs 97,600 per sqm from Rs 84,000 per sqm earlier. Similarly, for commercial plots in odd-numbered sectors, the new circle rate stands at Rs 88,2000 per sqm, Rs 76,000 per sqm earlier.

“This is a completely ill-advised move, which will have an adverse bearing on real estate market which is still trying to recover from the slump ... At a time when there is no buyers in the market, the circle rates should be left untouched if not lowered ... the hike in circle rates this will further discourage buyers.” Credai (National) Vice-President Manoj Gaur was quoted by ETRealty as saying. (CREDAI: Confederation of Real Estate Developers & Associations of India)
 
As circle rates are often higher than market rates of properties, there has been an increased effort by authorities to bring the two closer. According To PropTiger DataLabs, average property price at Vasundhara sectors 2, 3, 4 and 9, for instance, stand at Rs 5,100 per square foot (sqft). At this rate, one will have to shell out Rs 54,927 per sqm for a property at Vasundhara.