Ready recknor rates in Mumbai raised by an average 18%

Notwithstanding the economic slowdown and at least 20 per cent dip in the sales registration in Mumbai, the Maharashtra government has increased ready recknor (RR) rates by an average 17 per cent.

However, in 716 zones, comprising 124 villages/divisions of Mumbai, the RR rates would range between 5 per cent and 30 per cent. As far as rest of Maharashtra is concerned, the revision in RR rates would also be in the range of 5 per cent and 30 per cent.

The RR rates, primarily used to calculate the market value of flats for the stamp duty and registration charges, came into effect from January 1. Realty players, however, believe the revision in rates would put additional burden on them and on property buyers.

Chief Minister Prithviraj Chavan told Business Standard, "It is true that I had received a representation from a section of the legislators suggesting not to effect an hefty rise in RR rates for Mumbai in 2012 in view of the current slow down. The concerned department may have considered this view while revising the RR rates. The idea was not to heavily burden the end consumer."

The official informed that RR rates remained at an average 10 per cent each in 2006, 2007, 2008, 2009 and 2010. However, in 2011, RR rates were increased by an average 30 per cent. In Mumbai area, the collection of the stamps and registration was fallen by 20 per cent per cent at Rs 2,800 crore in October this year compared to Rs 3,500 crore of the corresponding period last year.

Similarly, the equity brokerage Prabhudas Liladher in its recent report said registrations of sale of properties have hit 31 month low in Mumbai due to high realty prices and mortgage rates. Sales registrations for the month of November 2011 are down 20 per cent on a year on year basis to 4,060 units and down 12 per cent month on month.

Yomesh Rao, d, YMS Consultants, said, "The new RR rates comes into effect from Sunday at a time when the much-awaited new development control regulations for Mumbai have not yet come. In such a situation, builders and developers would not able to put up their plans. Had the regulations come earlier the builders and developers would have paid premiums at the previous year in the already sluggish market. Increase in the RR rates especially when the whole year has been down is not a welcome gesture from the government."