News: Modification In Circle Rates To Channelize The Demand In New Areas Of Gurgaon-31.05.2017
Modification in circle rates to channelize the demand in new areas of Gurgaon
Ankit Sharma | ETRealty | May 30, 2017, 19:00 IST
Recent correction in the circle rates of Gurgaon are expected to channelize the demand in new residential areas of the city, according to the industry experts.
Circle rates have been reduced between 3-8% in new developing areas of the city while they have been raised by 2-8% in established localities. This is the second time the circle rates have been reduced in Gurgaon. In 2016-17, the Haryana government had slashed the circle rates by 10-15%.
Dr. Samantak Das, Chief Economist & National Director-Research, Knight Frank India says, “State government hopes that by increasing the circle rates in established and congested areas of old Gurgaon demand from home buyers will shift to new developing areas, which have witnessed a reduction in the rates.”
Circle rates have been reduced in areas like Sohna, Manesar, Pataudi, Sectors 58-115 and Sectors 10, 10A, 9 and 9A by around 5%. “These areas are the upcoming areas of Gurgaon, wherein maximum project launches are being expected. These areas have witnessed a buyer’s market for some time now. This rate cut further underscores this fact. The cut in circle rates will also increase the numbers of end users buying houses. Builders too will benefit from the positive sentiment building up in the market,” says Sopan Gupta, Principal Partner, Square Yards.
On the other hand, circle rates have been increased by upto 8% in some colonies of Old Gurgaon, like Friends Colony, Gandhi Nagar, Hira Nagar and Mohammadpur Jharsa. “These colonies have witnessed very less real estate activity in terms of primary sales which could have been the reason for the marginal increase in the circle rates. Since most of the property transactions in these areas are pertaining to the secondary residential purchase, we expect the overall impact to be quite neutral,” says Gupta.
Although circle rates do not impact the residential sales directly, industry experts believe that it will atleast infuse positivity into the residential market of the city. AS Sivaramakrishnan, Head, Residential Services, India, CBRE South Asia. says, “With the reduction in overall acquisition cost of properties in Gurgaon basis the new circle rates, potential home-buyers would re-look at this market for their requirements. This is expected to result in an uptick in demand for residential real estate.”
“Circle rate price correction may help in boosting a long dormant market and will also convert fence sitters to finally complete their decision to buy their dream homes,” says Brotin Banerjee, MD & CEO Tata Housing Development Company.
