Karnataka Reduces Stamp Duty Charges to 3% For Homes In The Range Of 35 – 45 lakhs

Following in the footsteps of its neighbour Maharashtra, the Karnataka government has proposed a 2 percent stamp duty reduction for homes valued between Rs 35 lakh to Rs 45 lakh, the state government said in its Budget announcement.

Karnataka Chief Minister BS Yediyurappa proposed a 2 percent cut in stamp duty for apartments valued between Rs 35-45 lakh in the state Budget 2021-22.

“To promote affordable housing, the stamp duty for the first registration of apartments valued between ₹35 and ₹45 lakh is proposed to be reduced to 3 percent from 5 percent,” he said on March 8.

Experts said the move will strike the right sentiment.

“While the move does carry a feel-good factor and will strike the right sentiment chord, it is not likely to give a significant boost to housing sales in Bengaluru on the lines of what we saw in Mumbai. Maharashtra had reduced stamp duty for properties across all Budget segments – not just one category. The fact is that housing demand in Bengaluru is largely skewed towards the mid segment, involving properties priced within the Rs 50 lakh to Rs 1 crore Budget range. For these properties, the stamp duty charges remain the same at nearly 5 percent,” said Anuj Puri, Chairman – ANAROCK Property Consultants.

As per ANAROCK Research, Bengaluru presently has a total unsold stock of nearly 59,350 units across all Budget segments. Of this, just 24 percent is within the Rs 45 lakh price bracket, while 64% is within Rs 45 lakh to Rs 1.5 crore Budget range. In other words, the cut within Rs 35 lakh to Rs 45 lakh Budget may not have a significant impact.

On August 26, the Maharashtra government decided to temporarily reduce stamp duty on housing units from 5 percent to 2 percent until December 31, 2020 to boost the stagnant real estate market, which had been hit hard by Covid-19. Stamp duty from January 1 until March 31 will be 3 percent.

(Source: Moneycontrol)