Maharashtra Govt Encourages Real Estate Industry With New Concessions

As the Maharashtra Government offered more information on the implementation of the newly approved real estate stimulus, the State Urban Department clarified that concessions offered by the previous government, such as for premiums until August 2021 in Mumbai, will remain applicable. 

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This move is expected to lead more developers to avail the benefits of concessional premiums, and consequently display an increase in developers seeking approvals for building projects in Mumbai during the first 8 months of 2021. 

This basically means that builders in the city will be required to pay premiums towards additional floor space index (FSI) and compensatory fungible FSI at only 17.5% of applicable ready reckoner (RR) rates for residential projects until August 19, 2021. Builders of commercial projects will have to pay premiums at 20% of the RR rate (also known as circle rate).

Read - Maharashtra: Pay Real Estate Premium On Or Before December 31, Get 50 Percent Off

Further, premiums for builders choosing to receive the concession will be counted by referencing existing circle rates or 2019-20 rates, whichever is higher. This basically means that construction projects in Mumbai will be eligible for higher concession rates as compared to the rest of Maharashtra. However, this advantage will only last until August 19, 2021. 

This comes as Chief Minister Uddhav Thackeray recently announced steps to bring down construction costs across Maharashtra. The government slashed the applicable construction premiums by up to 50% for ongoing and new projects in the state until December 31, 2021. 

Chief Minister Uddhav Thackeray also held a meeting with the State Cabinet Infrastructure Committee to go through a wide range of infrastructure projects across Maharashtra. Deputy CM Ajit Pawar and PWD Minister Ashok Chavan were also present at the meeting among other officials. 

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