Property prices to go up in Noida as administration proposes hike in circle rates

Property rates in Noida are expected to go up after the Gautam Budh Nagar administration proposed to hike existing circle rates by up to 40% and also apply an additional 5%-12.5% surcharge on properties near the metro route or near the expressway.

The administration, which oversees Noida, Greater Noida and Yamuna authorities, has sought suggestions and objections from the public following which the new rates will be applicable.

Some sectors of Noida including
sector 14A, 15A, 44, 19, 47 and 93 A and B have been upgraded leading to a circle rate increase of almost 100%.

“The circle rates were not hiked for two years and the decision to revise the rates has been taken based on the market conditions,” said a revenue department official.

The administration has also proposed an additional surcharge of 5% on properties on the metro route and near the metro stations, 7.5% additional surcharge on the sectors which lie on the both sides of the expressway and 12.5% on sectors which are near both the metro station and expressway.

The decision will increase prices in over 70 housing societies.

“We are just beginning to take steps to get back on track, but the recent move to increase circle rates in Noida might once again hamper the sector’s growth in the region,” said Manoj Gaur, CMD at Gaurs Group and vice president-north at CREDAINational. “An increase in the circle rate at this critical moment will prove detrimental.”

In Greater Noida, the administration has proposed to hike the rate from Rs 28,000 sq metre to Rs35,000 sq metre.

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“Due to the increase in circle rates, the buyers may not invest in any property in the short term and may like to hold off their buying decision for now, which will affect the realty market as a whole,” said Santosh Agarwal, CFO and executive director, Alphacorp.

Experts said the rebate given by Delhi government on circle rate is also ending next month and the recent circle rate hike in Gurgaon and the proposed hike in Noida will dampen the sentiment in the NCRmarket.

“The NCR market is already struggling with inventory overhang and low sales,” said ShravanGovil, CEO at Omaxe Heritage Pvt. Ltd. “An increase in circle rate at this stage will push the fence sitters away from the housing market and delay the recovery of real estate in the region.”

Harvinder Singh Sikka, MD at Sikka Group, said rather than increasing the circle rates, the administration should have maintained the current levels.

“The developer community is currently utilising all available tools to help buyers in realising their dream of owning a real estate asset, but it requires government help,” he said.

Noida real estate has been gaining traction and lately emerged as the most sought-after real estate destination in Delhi NCR.

The hike in circle rates is an indication of the increased demand that the region has been experiencing.

“Noida will keep adding new supplies in the next quarters and the availability of grade-A offices, competitive rentals, upcoming international airport, film city, electronics manufacturing hub, New Noidaplan and planned industrial hubs are also making it a prime location,” said Abhishek Pandey, vice president-customer engagement & distribution at Viridian RED.

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