Maharashtra cuts real estate premiums by 50%. Buying homes to become cheaper
The reduction in premiums would help the Mumbai market, said analyst
(MINT PRINT)
The reduction of premiums will be applicable till 31 December, 2021
The Maharashtra government earlier slashed the stamp duty charges to boost real estate sector hit by coronavirus pandemic
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To boost real estate sector hit by the coronavirus pandemic, Maharashtra government on Wednesday decided to reduce all premiums related to the sector by 50%. It will be applicable till 31 December, 2021. All projects which want to avail of the premium concession will have to pay full stamp duty for the customers till 31 December. High premium puts a financial burden on developers leading to higher costs for the homebuyers. The reduction in premium cost will help softened prices and renewed buyers interest, said experts. The concession will be considered for premium rates whichever is higher, 1 April 2020, o
Developers build hopes on uptick in residential sales
December 29, 2020
Discounts, delayed EMI payment, stamp duty waiver, among other factors, may draw home buyers
As 2020 comes to an end and businesses restart in the new normal, real estate developers are hoping that 2021 will deliver “good news” in terms of both residential and office absorption.
Low interest rates and government intervention have been welcome moves so far. The trends that have emerged over the last couple of months (October and November) in residential sales look “encouraging” too and specific markets such as Mumbai, Pune, Hyderabad and Chennai are reporting improvements.
Signs of revival
Explained: What does reduction in premium mean? Will it benefit Maharashtra’s real estate developers and homebuyers?
Reduced premiums can make projects viable for developers and help avoid project delays due to funding issues; lower development costs to realtors would mean lower purchase cost to homebuyers, which in turn can help boost demand.
Premium typically refers to the charges that are levied by the state with respect to approvals for initiating, progressing, and completing the area or additional area in a project.
After reducing stamp duties in the state from 5 percent to 2 percent until December 31, 2020, to boost residential sales, the Maharashtra government is now contemplating reducing the premiums on real estate projects by at least half, following recommendations of the Deepak Parekh Committee.