The state government has approved reduction in premiums by 50 per cent under the new DCPR rule 2034 across the board for on-going and new projects up to December 31, 2021.
Municipalities charge this premium on Floor space index or FSI which is construction allowed on a plot of land.
“This move will go a long way in expediting the project completion and the industry will witness new launches in the market. The industry applauds this booster dose making many projects viable and we shall adhere to the rules laid down in lieu of availing these benefits,” said Niranjan Hiranandani, chairman at Hiranandani Communities.
Also, the reduction in premiums for new launches will help the development at the lesser input cost and over a period of time there is possibility of lower price for new inventories that shall come into the market, he said .
“This reduction in premiums will help in quick turnaround of projects and uplifting Industry sentiments.”
The State Government had, in September, lowered stamp duty from the existing 5 per cent to 2 per cent till December 31 2020 and pegged it at 3 per cent from January 1 till March 31, 2021.
This led to jump in property sales in Mumbai and other major cities.
Home sales in Mumbai Metropolitan Region (MMR) saw grew by a significant 10 per cent year-on-year (YoY) to 30,042 units in H2 2020 propelled by the stamp duty cut, said a report from Knight Frank today
Sales picked up from September 2020 onwards and grew stronger towards the end of the year. Sales in Q4 2020 jumped a staggering 80 per cent YoY, it said.
Apart from stamp duty reduction plethora of other factors aided sales growth in H2 2020 such as – reduction of interest rates to historic lows, demand for upgrading to larger homes, festive period of Navratri-Dussehra-Diwali, developers offering host of direct/indirect discounts and increase in household savings during the lockdown, Knight Frank said.