The Times Group
A day after the state government increased the RR rates by an average 3.64 % in the city, developers on Sunday said they would have no scope to absorb any further increase in costs.
The developers added that they would be forced to pass on the increased development and premium charges, as well as the compliance costs that will come into effects following implementation of Real Estate Regulatory Authority (Rera) rules, on to the buyers.
Shantilal Kataria, president of the Confederation of Real Estate Developers' Associations of India's (Credai) Maharashtra chapter, said the overall increase of the RR rates will affect the buying power.
"The current increase also means a rise in premiums, development charges and labour cess. It is unlikely that the builders will share these costs," he said.
Credai Pune president Shrikant Paranjape said there's a direct link between the RR land rates and the premiums, development charges payable for sanctioning building plans and the stamp duty on land purchase. The developers would be affected, as the addi tional initial cost will reduce the number of projects that can be launched. "This can affect the government's housingfor-all goal," he said.
IT consultant Sneha Makhija, who was planning to invest in a flat in an upmarket area, said she will wait till next year. "The government has termed the increase as `slight'.But the rates in the city's core areas have seen a 10-12% rise.The developers are bound to increase property prices,"' she said.
Developer Sachin Kulkarni, who is into affordable housing projects, said: "Seven major states have waived stamp duty on affordable housing projects. Maharashtra had committed to doing the same.But now land and building ra tes have been hiked by more than 12% on the outskirts of Pune city. It was in these areas that the affordable houses are coming up in a big way ," he said.
Rohit Gera, vice-president of Credai (Pune), said: "Implementation of Rera is around the corner and this, too, will substantially increase the developers' cost structure."
Arun Gupta
