In a move aimed at providing stability in the real estate sector, the state of Maharashtra has decided to keep the land ready reckoner (RR) rates unchanged. This decision was formalized through a notification issued by the state revenue department on March 31, maintaining the RR rates at the same level as the previous year. Notably, this marks the fourth consecutive year without any revision, with the last adjustment occurring in the fiscal year 2018-19.
The decision to maintain RR rates has been met with approval from experts within the real estate industry. Hitesh Thakkar, vice president of NAREDCO West Maharashtra, lauded the move, stating that it aligns with the demands of the industry. Thakkar emphasized that keeping RR rates unchanged prevents an increase in housing costs, thus alleviating the burden on homebuyers.
Recorded Transactions in Mumbai
Despite the unchanged RR rates, March 2024 witnessed significant real estate activity in Mumbai city, which falls under BMC jurisdiction. According to data, a total of 14,411 properties were registered during the month, contributing substantially to the state government's revenue. These registrations amounted to Rs 1,143 crore, reflecting a robust real estate market in the city. While stamp registration showed a promising increase of 10 percent year-on-year (y-o-y), revenue from property registrations experienced a decline of 7 percent on a y-o-y basis. Analysts attribute this decline to the comparatively higher collections observed in the previous year. This surge followed the Center’s decision to restrict tax deductions on capital gains from residential property sales after March 31, 2023, as reported by Knight Frank India, a leading real estate consultancy.
Understanding Ready Reckoner Rates
Ready reckoner rates serve as the minimum valuation set by the state government for properties in specific areas. These rates play a crucial role in calculating various taxes, charges, and fees associated with property transactions, including stamp duty and registration fees. Periodically assessed and revised by government-appointed authorities, these rates are influenced by factors such as location, market trends, and property characteristics. For those unfamiliar with RR rates, they are essential benchmark values within the real estate domain. They aid in computing capital gains under income tax and determining stamp duty and registration charges payable to the state government by buyers. Varying across regions, RR rates cater to different property types, including residential, commercial, and industrial. They are released annually at the beginning of the financial year in Maharashtra and are also known as 'circle rates' or 'guidance values' in other regions of the country.
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