In a bid to boost the real estate sector, the state government is planning to reduce the ready reckoner (RR) rate in and around Mumbai. This decision is expected to be announced in the budget scheduled to be tabled this month.
The real estate sector has been struggling to survive because of the economic slowdown as well as the Goods and Services Tax (GST) and demonetisation.
Despite various announcements by the central government, there is hardly any progress in this sector.
The Maha Vikas Aaghadi government has also been trying hard to put this sector on the growth trajectory. "Chief Minister Uddhav Thackeray is positive about reducing the the RR rate. This will be announced in the budget," told a highly placed source in the housing department.
The builder organisations have already demanded 20 per cent cut in this rate. The RR rate changes as per the area, localities and cities too. For example, the RR rate for a residential flat near the Gate Way of India is Rs 4,13,200 per square metre and the same rate for a flat between Hutatma Chowk and Chhtrapati Shivaji Maharaj station is Rs 3,06,600 per square metre.
Thackeray, in the second part of his interview published in Saamna, Shiv Sena's mouthpiece, has promised that the dream of Mumbaikars who wish to own a home will be fulfilled. "Many redevelopment projects are stuck in Mumbai due to various complexities. We will have to do away with these complexities and bring in investments. Financial institutes are ready to help but they want some reforms. I wish to see all those who have surrendered their home for redevelopment projects stay in their own new homes," he told Saamna.
The recession in real estate sector can be understood by the fact that around 1.40 lakh flats in Mumbai are unsold. The cost of the unsold flats are more than Rs 100, 000 crore. Deep Tanna, builder of Shree Sai Developer and also a member of the Maharashtra Chamber of Housing Industry (MCHI), welcomed the move of the government to reduce the ready reckoner rate across Mumbai.
He said, "If we have to buy 50 per cent of TDR or extra TDR for our project, we have to buy it on the basis of the ready reckoner rate of the government. Since the RR rate is high and varies for different areas, the premium money in lieu of the extra FSI or TDR charged is too high. Therefore, it is a good move." Tanna stated that it will also help in controlling the price of properties.
