Noida and Greater Noida developers oppose new registration mandate
Real Estate

Noida and Greater Noida developers oppose new registration mandate

Real estate developers in Noida and Greater Noida are pushing back against a recent local mandate requiring the registration of builder-buyer agreements after buyers pay 10% of the property price. This mandate obliges buyers to pay a 6% stamp duty upon making this initial payment, which developers argue will impose an added financial burden on homebuyers.

Manoj Gaur, chairman of the Confederation of Real Estate Developers' Associations of India (CREDAI), criticised the mandate, stating that it unfairly pressures buyers who already struggle to meet the upfront costs of booking. Gaur also highlighted that in other states, sale agreements are made on nominally priced stamp papers, unlike the 1% non-refundable registration fee imposed here, which he says represents a direct loss for buyers.

The developers further expressed concerns over the lack of a clear refund policy in case of booking cancellations, as approximately 15-20% of residential bookings typically face cancellations due to unforeseen circumstances. Gaur, who also chairs Gaurs Group, noted that this mandate could negatively impact the entire real estate sector in Uttar Pradesh, including Noida, Greater Noida, and the Yamuna Expressway, where the industry has significantly contributed to the state’s economy.

The National Real Estate Development Council (NAREDCO) also voiced concerns, with its president, R.K. Arora, pointing out that the decision was made without consulting developers or homebuyers. According to Arora, the mandate risks worsening liquidity issues for ongoing projects and could discourage new buyers from entering the market. NAREDCO has appealed to the authorities to reconsider the mandate to avoid further financial strain on both buyers and the sector as a whole.

Previously, buyers and developers would enter into an unregistered sale agreement on a Rs 100 stamp paper, with formal registration and a 5-7% stamp duty paid upon project completion. The new mandate requires a 1% registration charge on the property value at the agreement stage, adding another layer of cost that Sanjay Sharma, director at SKA Group, argues will disproportionately affect middle-income homebuyers in the region.

Real estate developers in Noida and Greater Noida are pushing back against a recent local mandate requiring the registration of builder-buyer agreements after buyers pay 10% of the property price. This mandate obliges buyers to pay a 6% stamp duty upon making this initial payment, which developers argue will impose an added financial burden on homebuyers. Manoj Gaur, chairman of the Confederation of Real Estate Developers' Associations of India (CREDAI), criticised the mandate, stating that it unfairly pressures buyers who already struggle to meet the upfront costs of booking. Gaur also highlighted that in other states, sale agreements are made on nominally priced stamp papers, unlike the 1% non-refundable registration fee imposed here, which he says represents a direct loss for buyers. The developers further expressed concerns over the lack of a clear refund policy in case of booking cancellations, as approximately 15-20% of residential bookings typically face cancellations due to unforeseen circumstances. Gaur, who also chairs Gaurs Group, noted that this mandate could negatively impact the entire real estate sector in Uttar Pradesh, including Noida, Greater Noida, and the Yamuna Expressway, where the industry has significantly contributed to the state’s economy. The National Real Estate Development Council (NAREDCO) also voiced concerns, with its president, R.K. Arora, pointing out that the decision was made without consulting developers or homebuyers. According to Arora, the mandate risks worsening liquidity issues for ongoing projects and could discourage new buyers from entering the market. NAREDCO has appealed to the authorities to reconsider the mandate to avoid further financial strain on both buyers and the sector as a whole. Previously, buyers and developers would enter into an unregistered sale agreement on a Rs 100 stamp paper, with formal registration and a 5-7% stamp duty paid upon project completion. The new mandate requires a 1% registration charge on the property value at the agreement stage, adding another layer of cost that Sanjay Sharma, director at SKA Group, argues will disproportionately affect middle-income homebuyers in the region.

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