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CREDAI (Confederation of Real Estate Developers Associations of India) Andhra Pradesh has advised the state government to come up with necessary steps in order to slash the stamp duty on registration of properties. This move would benefit the homebuyers, and they would be able to purchase new properties with ease. In the process, the state government would benefit from increased revenue. The real estate sector would also get a boost once the state reduces the property stamp duty.
Presently, property owners need to pay a duty of 7.5%. CREDAI has urged the government to reduce this duty to 2%. Presently, the real estate industry of the state is under the pressure of the pandemic. Enacting easy norms for the property investors would relieve the sector substantially. Besides, CREDAI has also felt that the state lacks skilled labour in the real estate sector. The reason is that before the pandemic, more than 40% of the labours migrated to Andhra Pradesh from other states. Due to the lockdown, they had to return to their respective states. However, they are yet to get back to work.
The President of CREDAI further pointed out that back in 2009, the stamp duty was reduced to 2% from 7.5%. This revised rate was in place for two years, amidst a global economic crisis. During that time, the decision had enabled the real estate sector to gain more buyers. They purchased new flats in large numbers, which eventually strengthened the state’s economy more than a decade ago. With the pandemic still taking its toll on finances, homeowners with reduced purchasing power would benefit from the reduced stamp duty. At the same time, it would strengthen the real estate sector.
Members of CREDAI also added that this reduction would boost the same of flats as well as associated products in Andhra Pradesh’s towns and cities. In the process, this would increase the revenue generated through GST.
In this context, it should be noted that the middle-class property buyers are saddled with an increment in the prices of steel and cement. In the last few years, prices of cement increased to INR 150 from INR 100 per bag. This resulted in an increase in the prices of flats by INR 100 per square foot. Prices of steel have also significantly increased in recent years. All these factors led to an increment in property prices. With reduced stamp duty rates, homeowners would be at ease while purchasing new properties.
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