The property market in Gujarat has touched a size of Rs 72,300 crore, after it grew by 30 per cent in terms of value during 2011-12. Though unofficial estimates show the actual size of the real-estate market at Rs 1 lakh crore, figures from the state revenue department show 9.07 lakh property transactions happened across the state in 2011-12.
However, there is a drop of 11 per cent as far the number of property transactions is concerned.
The state government had targeted to collect Rs 5,000 crore as stamp duty and property registration fees last year. However, the ambitious target was missed in spite of the government earning a record Rs 4,300 crore (Rs 3700 crore as stamp duty an Rs 531 as registration fee).
Currently, the state government levies a stamp duty of 4.90 per cent and registration fee of one per cent (a total 5.90 per cent duty and fee is levied) on each property transaction.
In spite of the real-estate industry passing through a lean phase, the state government has set a revenue target of Rs 5,500 crore for the year 2012-13.
Senior officials in the state revenue department estimate that the actual size of the real-estate industry in Gujarat could be over Rs 1 lakh crore.
“Around 40-60 per cent of the real-estate transactions do not find a mention in the record books. This is done to avoid tax. The state government losses hundreds of crores due to this practise but at present there is no effective way to control it. If we consider that 40 per cent transactions are done in black or 40 per cent of the value is under reported, the state government lost stamp duty and registration fees worth Rs 29,000 crore from this unaccounted volume in 2011-12. If this amount is added to the official volume of the industry, the total estimated size of real estate industry in Gujarat can be pegged around Rs 1,01,283 crore,” said an official of the state revenue department.
Despite high claims of growth in the industry by the real estate developers, the state has witnessed a drop of 11 per cent as far as the number of registered properties are considered.
In 2010-11, property deeds to the tune of 10,05,941 were registered, while in 2011-12 the figure reduced to 9,07,375. Ahmedabad, Surat, Junagadh, Rajkot, Vadodara and Kutch districts witnessed the highest number of registration in 2011-12.
However despite fall in overall registration properties the state government’s income from stamp duty and registration fees increased from Rs 3,025.60 crore in 2010-11 to Rs 4,268.38 crore in 2011-12 mainly due to increased rate of Jantri rates (minimum prices of the land fixed by the government).
