Chandigarh: The Punjab government's ambitious plan to mop up Rs 2,760 crore in the current financial year from stamp duty and registration fee is going to be an uphill task in view of the slowdown in the real estate sector.
According to real estate experts, buyers are yet to enter the market despite the fact that property prices have undergone a correction to the tune of 10-30 per cent, depending on the location.
Property consultants said high realty prices, low appreciation and lack of funds had kept most investors away from the real estate market for almost two years now.
Property prices are seeing a downward trend in Punjab and while some might see it as a correction, there are also those who see in it the burst of the realty bubble. Harpreet Singh, a sales officer with a local developer, said over the past five months or so, the real estate business in the state had recorded an unprecedented fall. Land prices had either come to a standstill or, in some instances, were drastically down. For instance, while an acre of land was fetching a whopping Rs 3 crore six months back, it is not finding many buyers now even at Rs 2.5 crore.
Experts feel that the bubble was just waiting to burst in Punjab, as property dealers had pushed it to unprecedented limits. Even in areas such as Zirakpur, Derabassi, Kharar, among others, in the vicinity of Chandigarh, the dream home had remained just a dream for the common man, and as the real buyer was missing from the scene, the business had to crash. Dealers in Amritsar, Bathinda, Mohali and Sangrur, said there had been a slump in property prices.
According to senior officials of the state government, due to a downturn in property prices, the state government's revenue had also been affected. According to the initial data, due to a slowdown in the real estate market, the chances of meeting the bench mark of revenue target in the current fiscal year would be rare.
The revenue the state earns from stamps and registration was revised during the last fiscal year due to the slowdown. Initially, the state had set a target to collect Rs 3,450 crore in 2013-14. But it managed to earn Rs 2,560 crore, against a revised target of Rs 2,510 crore after the economic slowdown hit the realty sector and sale and purchase of land across Punjab virtually came to a standstill. This year, the state is targeting just a 10 per cent increase in its stamp and registration revenue - at Rs 2,760 crore. Presently, the stamp duty in Punjab is 6 per cent for men and 5 per cent for women. While the registration fee is at 1 per cent .