Ehsaan

PUNE: Rising interest rates on home loans have started to show a tapering effect on enrolment of new property transactions across the state.

"Post-latest hike, fresh enrolments have slowed down compared to the first nine months of the ongoing financial year 2006-07," O.P. Gupta, state inspectorgeneral of registrations (IGR), told TOI. "We expect the slow down to remain for the next two months," he added.

Gupta was not unduly worried though, considering that his office is set to make a cool Rs 700 crore in excess of the targeted Rs 5,600 crore revenue for the year — primarily riding on the realty boom and to an extent, initiatives aimed at simplification of enrolment procedures.

In the last two-and-a-half years, home loan rates (floating) have gone northwards from 7.5 to 11.75 per cent, forcing an increase in the equated monthly instalment (EMI). The latest rate hike took effect on February 9.

"Apparently, those sitting on the fence have put off their plans to buy home against high-interest loans," Gupta said and added that the situation provided little comfort to his office in terms of revenue collection.

A bulk of the revenue generated by the IGR comes from registration of property transactions, including fresh buying, lease and transfer, conveyance deeds and agreements. Registration of marriages, hypothecation and mortgage are some other revenue-earners.

Gupta said the overall situation this year had been quite positive with an eight to 10 per cent rate of growth in enrolments going along the expected lines.

Of the total 16 lakh transactions enrolled from April 1 to December 31, 2006, property deals accounted for 13.5 lakh, which is up from 12 lakh registrations during 2005-06, he said.

Against a revenue earning of Rs 5,300 crore in 2005-06, the IGR office had made a budgetary estimate of Rs 5,600 crore for 2006-07. However, it is set for an earning of Rs 6,300 crore by the end of 2006-07, which is up by Rs 700 crore, he added.

Pune has been the fastest growing region, having earned Rs 900 crore in 2005-06 that prompted the IGR office to revise its revenue target for the city to Rs 1,220 crore for 2006-07. "Our collections from Pune have already touched Rs 976 crore by end of December," Gupta said.

According to Gupta, the introduction of computerised stamp duty administration system played a key role in the improved earnings. "Electronic transactions alone helped us earn Rs 250 crore," he said.

Source: //timesofindia