Buying Chennai PropertiesRegistration of Properties

GUIDELINE VALUES in TAMILNADU

GUIDELINE VALUE

What’s Guideline Value?

Guideline Value is the Value of a Property fixed by the Government, below which the Registration of a Property can’t be done. The Primary purpose of fixing the Guideline Value is to prevent evasion of Stamp Duty. The Guideline Value should reflex the Market Value of the property.

Developments in a locality, rate at which previous transactions took place at the particular Survey Number or Street, are taken into account while fixing the Guideline Value

Why Should One Know the  Guideline Value for a Property?

Once a buyer has decided to buy a Land/Plot or an Undivided Share of Land (UDS), and the price has been finalized with the Seller, the Registration of the Sale Deed  has to be done by paying Stamp Duty and Registration Fee to the Government. And the Stamp Duty is calculated as percentage of the Guideline Value or Market Value, which ever is high at which the Registration of is done.

This will help one know the total outflow of funds in buying a property. Currently in 2013, in Chennai, the Stamp Duty is 7% of the Value of Property, mentioned in the Document and this Value cannot be below the Guideline Value, though, one would have negotiated a lower price for the Property.

The Banks and Financial Institutions also, sanction the Home Loans or Mortgage Loans based on the Guideline Value only.Guideline values give an indication of the Market Value of the property.

 

Guideline Value Expressions

Guideline Value is expressed as Rs…………per sq.ft or Rs……….per Acre . For Cities and Towns and for developed Lay-outs it may be in ‘per sq.ft’ whereas for Agricultural Land or Undeveloped Lands it will be in ‘per Acre’

In Cities and Towns for an entire stretch of a Street or part there of, may have the same Guideline Value irrespective of different Survey number for different plot/land parcel in that Street/Locality.

In  newly promoted Nagars, normally same Guideline Values are given for the Lay-outs approved by CDMA/DTCP. However, for the ‘panchayat approved’ Lay-outs, this may not be the case and the Guideline Value may vary with different plots in the same Lay-out. 

How to Know the Guideline Value of a Property

The Guideline Values for the Survey Numbers and Streets can be found out from the Govt’s official website of the department of registration, REGINET. Required Data has to be input in this portal to get the Guideline Value. For this, the Survey Number or Street Name,Village Name, and the Name of the Sub-Registrar Office should be known. These details will be available in the Schedule of Property attached at the end of any Sale Deed.
  
The Guideline Values obtained at REGINET would give an idea of the property at that area posted by the Department. However, it’s better to confirm it by a visit to the Sub-Registrar Office. The officials there will tell the Guideline Value orally. There is no payment of fees involved. 

Hike in Guideline values in Tamilnadu 

The Government of Tamilnadu has last year(2012) hiked the Guideline Value almost in all areas manifold, in some areas up to 300%.

The guideline value is normally determined every year. But, there was no revision for the last 5 years, since 2007.When it was done last year,the hike appeared to be high. As, several anomalies had cropped up in the revision exercise carried out in April 2012, and the state-level Valuation Committee headed by Inspector-General Registration appears to have decided to defer the upward revision by a  year and so Tamil Nadu government did not carry out the Annual Upward Revision of Guideline Values  this year.As per law, the State-level Committee has to revise the value every year in October, but last year the government has deferred the decision in view of the objections raised. 

In Chennai, objections were raised over the Guideline Values fixed in many areas, where people felt the registration department had fixed abnormally high rates. In fact, in many places the Guideline Values continue to be higher than the market value.

According to reports, the panel appointed by the department  has so far done downward revision of guideline values for 89 survey numbers. Throughout the state, several thousand petitions seeking downward revision of values are still. pending. The Deputy Registrars have been told to look into complaints and the District-level Committees headed by District Collectors have to send the recommendations to the State-level Committee. 
 
This revision further affected the Investment sentiment and adds to the dull investment climate in the market today.In spite of all these,transactions have started picking up of late and the Chennai region saw an increase of 13% in terms of revenue collections compared to the previous year.

Impact

This increase certainly has resulted in fall in registration initially, but it has some benefits also like those who go in for Bank finance can now get better quantum of finance as the Bank finance on guideline value only and not on the Market value.

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