High Circle Rates Causing Slump in Realty to Reduce by Delhi Government

High Circle Rates Causing Slump in Realty to Reduce by Delhi Government

The real estate market of India and in particular Delhi has taken a toll in the past couple of years. The reasons have been mainly buyers’ sentiments and some of the government’s policies. One of the major reasons for the slump in selling and purchasing of flats and plots occurrence was due to an increase in circle rates four times in the past five years. But things will now change for the betterment of real estate of Delhi as the AAP government has decided to revise the circle rates seeking proper public opinions. This has come as the latest news which arrived with Gurgaon slashing 15% tariff.

The move has come in lieu of many complaints by the market traders that circle rates are higher than market rates which have created a vacuum in the market. Many investors are of the view that high circle rates leading to high registration amount may not be worth since the return will not be as high as expected. The circle rates are very important for the revenue generation of Delhi and hence, Arvind Kejriwal, the Chief Minister of Delhi has assured the industrialists that the government will take required measures to see that circle rates come close to the fallen market rates. The rates used to be decided by the municipal corporations which divided Delhi into creasing affluent zones of 8 parts: A-H.

Delhi must follow the path of Gurgaon as it has not hiked circle rates in the past two years. Working according to the market can regulate the money in a better way. Convener of AAP’s Trade Wing, Brijesh Goyal has confirmed that Delhi people will have their say before government commits to any decision regarding the revising of circle rates.

This decrease in circle rates is in contrast to 6-7 times increase in circle rates of areas falling under land pooling policy zones in delhi, which are being developed under Master Plan Delhi 2021(MPD 2021). Circle rates have been revised from 52 lakhs per acre to 3-3.5 lakhs per acre in following LPP Zones:

1- L Zone & K1 Zone near Dwarka,
2- P2 Zone near Rohini,
3- N Zone near Narela, and
4- J Zone near Mehrauli and Gurgaon boarder.