Maharashtra Government on August 26 declared that the stamp duty on house properties will be reduced temporarily from 5 percent to 2 percent until the end of the year 2020. This decision was taken to make the real estate industry dynamic which was nearly stopped due to the COVID-19 pandemic.
Key points of News:
Earlier the stamp duty was 5%.
From 1st Sep 2020 to 31st Dec 2020 Stamp Duty is declared 2%
From 1st Jan 2021 to March 2021 Stamp Duty is declared 3%
For rural areas, from 1st Sep 2020 to 31st Dec 2020 Stamp Duty is declared 1%
At the state cabinet meeting on August 26, the government decided to reduce the stamp duty by 2 percent from January 1, 2021, to March 31, 2021.
In rural areas, it will be reduced from 4 percent to 1 percent till December 31, and 2 percent from January till March 31, 2021
To support home buyers for buying a home during a pandemic, real estate developers had been asking for a reduction in stamp duty.
"This decision by the government will benefit the customers, allied industries, and eventually will boost employment in the industry. Take it from the past; whenever there was a reduction in stamp duty it has boosted the revenue in Government Treasure".
- Jaxay Shah, Chairman, CREDAI National
"This was a motivational decision by the Maharashtra government which was most required during this situation. It will help buyers financially to buy homes and support in making the decision of home buying".
-Satish Magar, National President of the Confederation of Real Estate Developers' Associations of India
"Maharashtra Government's decision to reduce the stamp duty from 5% to 2% till December 31 augurs well for the revival of MMR realty and is a much-needed boost to the ailing sector amid the pandemic. The reduced cost of the stamp duty is bound to encourage first-time homebuyers, fence-sitters as well as resale flat buyers to invest in real estate,"
- Nayan Shah, president, Credai-MCHI.
As Indian festivals are lined-up in few next months the reduction in stamp duty will make buyers more proactive for buying homes. The developers who have been suffering from low demand for buying a home this decision will increase the demand of consumers and cash flow for construction.
"This will certainly stimulate the housing demand and help in converting inquiries into the sales closures. The fiscal advantage should nudge fence-sitters to convert into the actual home buyers with rippling effect on economic growth." adding that With many other favorable market conditions, this announcement shall rekindle ailing real-estate sector and see volumes in transactions. "If the central government can slash GST rates in an upcoming council meeting would act as a shot in the arm".
-Niranjan Hiranandani, National President, Naredco
The stamp duty charges in Maharashtra are 5 percent in main cities like Mumbai, Pune, Nagpur and Nashik and 6 percent in others. The reduction of 2-3 percent in the rates will help buyers in their savings.
Due to pandemic, developers and real estate dealers have already implemented giving discounts on their housing properties, and the decision was taken by Maharashtra Government on the reduction of stamp duty till December 2020 is probably the best opportunity for buying homes.
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