Jaipur: State govt’s hike in DLC rates is set to make homes more than 20% costlier, hitting buyers not only through higher property prices but also increased stamp duty.While the immediate impact would result in home buyers paying 20% stamp duty or more depending on the area, it will also make property prices costlier.Credai-Rajasthan president Ravindra Pratap Singh said, “Direct impact of DLC rate will be on the common home buyers. They will have to shell out more stamp duty which could be substantially in the upwards of 20%.”Realty developers also pointed out that the DLC rate hike will make land costlier. “Since the land cost will be higher, the houses built by the developers will go up. Builders will pass on the higher cost to the buyers.”Many in the sector said it would be like double taxation for the home buyers which is expected to erode their purchasing power parity.“The middle class and lower middle class end users may compromise the size of the houses they are planning to buy. Some may postpone their purchases to a later date because their EMIs will also go up,” said developers in Jaipur.There is fear that such hikes which have happened twice in the past four months are likely to impact the sector.Sources said the govt’s financial condition is strained and it wants to raise its revenues through such measures.“Whether it will slow down demand or not will unfold in coming months and quarters. But certainly it is a dampener for the real estate sector.”Some segments of the real estate industry pointed out that there are places where properties like Crystal Mall, Ganapati Plaza, and others where the DLC rate is much higher than the market rate.Even if the owners want to sell their properties in these places and others like these at the DLC rate, there are no buyers.Credai-Rajasthan vice chairperson Rajendra Singh Pachar: “How can a transaction happen when the market rates are lower than the DLC rate? It is hard for the owner to find a buyer,” said a developer.Pachar said that while the revenues of the stamp and registration department will increase, expenses of other departments like PWD, PHED and irrigation will rise as they acquire land for building infrastructure such as building roads, laying pipelines and other works.Earlier, govt had announced annual revisions in rates. But builders argued that changing rates at govt’s discretion creates uncertainty and disrupts buyers’ plans, leaving them to bear the brunt.
