Noida likely to see a 30% hike in circle rates

The stamps and registration department has proposed to the district magistrate to update the circle rates, which have remained unchanged for the last five years. “The proposal aims at increasing the circle rate by 25-30% in residential areas, 10% in industrial, commercial and IT sectors, and 15% in case of farmland,” stated a Times of India news report.

District magistrate Manish Verma told Times of India that the new circle rates would be announced for public feedback in two days.

The updated circle rates will impact property prices in different categories, leading buyers to pay higher stamp duty.

The circle rates were last revised on August 8, 2019. Usually, circle rates are revised annually and implemented from Aug 1. Officials told Times of India that the circle rates will remain unchanged from 2020 to 2023 due to the real estate sector's downturn caused by the lockdown.

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Earlier this year in Ghaziabad, the stamps and registration department suggested increasing circle rates by 15% to 20% for residential and commercial properties, following a two-year freeze.

How is stamp duty calculated?

Stamp duty for a property is calculated based on the circle rate set by the district administration or the land allotment rate established by three development authorities — Noida, Greater Noida, and Yamuna Expressway — in their respective areas, whichever is higher. These authorities typically update their allotment rates every six months to a year.

Shashi Bhanu Mishra, assistant inspector-general of registration, told the Times of India

, "Yes, the stamps and registration department has submitted a proposal to the district magistrate to revise the rates. Circle rates have remained unchanged since 2019. The cost of flats has gone up considerably in Noida and Greater Noida over the past few years. In comparison, the stamp duty collected — which is based on the circle rate — is much lower. The rates should be revised to close this gap somewhat."

The math

Here is a look at how you will be impacted, as per the Times of India news report.

In Noida, the rates will vary for sectors and categories like residential, commercial, industrial, and IT.

For instance, the rate for residential plots in Noida sectors 14 and 14A is around Rs 1,1 lakh per sqm, while it is Rs 79,200 in Sector 19.

In Greater Noida's Alpha 1, 2, and Gamma 2, the circle rate is Rs 37,000 per sqm.

What is circle rate
The circle rate is the minimum price for a residential or commercial property to be registered for sale or transfer. This rate is set by the state government or development authorities and can vary between different areas within the same city. Circle rates are designed to prevent artificially inflated prices and speculation in the real estate market. It's important to note that the circle rate is not the property's actual market price and may be lower than the prevailing market rates.

Circle rates play a crucial role in ensuring transparency, fairness, and standardization in property transactions. Understanding the calculation of circle rates and their significance can help both buyers and sellers navigate the real estate market more effectively. Moreover, being mindful of how circle rates can impact land values can be advantageous when making decisions about real estate investments.