FY13) shows that property prices in Kolkata have dipped 5.57% quarter-to-quarter, the third most decline after Guwahati and Ludhiana among the eight cities that have shown a declining trend. According to the NHB data Jaipur witnessed the highest quarter-to-quarter increase —28.74%— in the last quarter, FY13 with 10 other cities showing an increasing trend.
However, SS Bagaria, owner of AHW Steels, who won the bid in KMC’s recent auction, said land prices in Kolkata was sky rocketing because of an acute crunch in land availability. A number of infrastructure projects like the east- west metro corridor have occupied most of the land and the scarcity has created a good market for properties. He expects that his R400 crore ultra luxurious apartment project would fetch good returns with each apartments to be sold at prices between R5 crore and R6 crore.
Reddy said tracking real estate price movement on the basis of data received from registration authorities of state governments would not be perfect since the circle rate adopted for computation of gains is based on presumptive value.
The government has proposed taxation on property deals inserting section 43 CA of the Income Tax Act.
The taxation would be done on the assessed valuation of a property at the time of transfer instead of on the sale price fixed when the project was initiated. This has a cascading effect on the realty prices with buyers finally having to pay more; Reddy said adding that Credai was talking to the finance ministry on the issue.