City Beat: High Prices Cost Chennai Property Dear [Video]
Quite similar to the situation in Gurgaon, properties in Chennai are not finding many takers, thanks to their high price tag. According to media reports, Chennai's property registration department witnessed a decline in number of property registrations in the last financial year. This is the fourth year when these numbers have gone down in a row. While the department registered about 35 lakh documents in 2011-12, earning Rs 6,620 crore in revenue, this number fell to 25 lakh documents in the last fiscal. It has to be noted that property registration and stamp duty charges are the key source of revenue for city administration and the fall in numbers indicates the city authorities might be staring at a possible financial crunch. While a home buyer in Chennai has to pay a stamp duty of seven per cent of the value of the property, he has to pay one per cent of the same as the registration charges. It has to be noted that Chennai is among the cities, where the stamp duty charges are much higher when compared to other major cities of the country.
According to a PropTiger DataLabs report for the first quarter of the financial year 2016-17, while sales have gone up 10 per cent quarter-on-quarter, new launches have seen a decline in Chennai in the same period. Developers in the city are also facing an average inventory overhang of 38 months.
Meanwhile, according to another media report, the Chennai Smart City project may see a delay as the project feasibility is yet to be decided. This is being attributed to the loopholes in the previous planning and site inspection patterns. The special purpose vehicle created to implement the project has now formed panels to carry out a detailed study on the feasibility factor.
Chennai was among the 20 cities which were selected in the first phase to be developed as smart cities by the central government earlier this year.