Due to the immense business growth in and around cities such as Noida, it has become very important for both homebuyers and home sellers to understand circle rates. With the potential 25% rise in the circle rates in Noida, property prices are possibly going to escalate significantly, reducing the number of transactions.
Circle rates are the government-specified minimum prices at which property transactions are to be legally registered. They play an important role in providing fairness, curbing tax evasions, and providing the standards used to evaluate properties. “Circle rates enable banks to lend the appropriate amount for property, and little is lost in property value as everything is documented,” says Gunjan Goel, Director, Goel Ganga Developments.
In the case of homebuyers, these rates affect the payment of stamp duty and registration fee, while in the await of the property, others might be questioned if they are selling at a price lower than the prescribed rate. For example, if the circle rate for a property is Rs 50 lakhs and the market value is Rs 60 lakhs, then the buyers will have to pay high stamp duty on the property of Rs 60 lakh and will be able to avail a home loan for the same.
Therefore, to be able to navigate the real estate market, the appreciation of circle rates is imperative to facilitate informed decisions and resulting effective transactions.
Read More: Understanding circle rates: A simple guide for homebuyers and sellers
