You may have heard of the term ready reckoner rates. These are basically the rates which indicate the values of commercial or residential properties of a particular area which are fixed by the State Governments and published on an annual basis. These rates can change based on factors like the infrastructure that is available and the area being considered. They can also affect stamp duty that is levied on property transactions and also the revenues of the State Government. They also affect market values of property.
Any changes in the ready reckoner rates also impact costs of real estate and additional transaction linked charges. The ready reckoner rates in Pune are expected to increase by around 3% in 2018 and the final confirmation should come anytime by the 1st of April, 2018. The hike is lower this time as compared to earlier years as per reports. Authorities are deeming this hike necessary based on factors like the registration of properties in every zone and sales figures. Experts feel that ready reckoner rate increases may impact the real estate market at a time when things are just looking up for the sector.
A hike in ready reckoner rates may lead to real estate developers increasing prices of their properties. Although prices of property should remain stabilized in the short-term or even from a medium term perspective, capital values may increase in the long haul. Demand and supply equations may also be impacted by this hike. Experts opine that the ready reckoner rates should be kept the same by the authorities in order to give the real estate sector some more time to recover from the headwinds like GST and RERA along with demonetization.
The rates should be at par with the right values which are deemed suitable and practical in the present scenario according to market experts. Increases can only benefit the real estate sector when there is huge demand in the market, prices are high and sales volumes have increased as well. In case the market prices are on the lower side and the ready reckoner rates go higher, this will lead to several issues for homebuyers and real estate developers alike.