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- as long as black money rules
A well-regulated real estate market will make a huge difference to the
way we transact business.However, it must be borne in mind that
a sizeable portion of real estate deals are in black.The rich and powerful in
our country will not allow business to be transparent as it will become all the
more difficult to hide their wealth.
It may be possible to ensure that persons purchasing real estate
provide their PAN numbers so that such transactions can be accounted for.That will put an end to benami deals.
Lets hope if there is an RE crash such regulations will be brought into force.
- Well regulated real estate market will drive out the speculators and investors . It is very good for the end users. Hence much apperication or gains cant be expected. The RE investment will be more or less equivalent to Banks savings depoistn with a decent returns. My simple thoughts!.CommentQuote0Flag
- You have misunderstood the word regulation ...Originally Posted by paul1970Well regulated real estate market will drive out the speculators and investors . It is very good for the end users. Hence much apperication or gains cant be expected. The RE investment will be more or less equivalent to Banks savings depoistn with a decent returns. My simple thoughts!.
If you remember, the Stock Market in the 80s and 90s had a system called the Badla System which was used to speculate (actually carry forward trades across settlements. It was not a good system, but, in the absence of any other option it worked. Then came our current Futures and Options system. And remember, the old Stock Markets had rampant black money in operation. Though there still is quite a bit in the system today, much of the system works on white.
So, nothing in this world is irreversible or unchangeable.
A well-regulated system can co-exist with a good speculative environment. In fact to have healthy speculation (an oxymoron since speculation itself is considered unhealthy :D), good regulation is required so that people can confidentally transact trades.
So, back to my question. Why not a properly regulated system in RE. After all, there are millions of people, especially youngsters who are least interested in Black Money operations - In my opinion, its only the oldies who operated in the 70s to 90s who are continuing the "tradition" of black money. In fact, though I want to buy a house completely in white, who is able to oblige me? Where can I do such a deal in India today? I believe that, if the various hassles in owning a home is removed by proper regulation which protects the rights of the buyer, then it would be a small price to pay to do all the transactions in white and millions would be happy to do so.
- the ' how' of it
There is no doubt that all law-abiding citizens would welcome
regulation in the real estate sector.the question is not whether
it should be done but how it can be done.
it is not an easy task to determine the market value of a given
property as is seen by the difficulty experienced by the govt
while acquiring land for public purposes.
In addition to transactions largely taking place in black,an additional
problem is the misuse of Power of Attorney,which does not
even come under the radar of govt records.In recent times,
obtaining Power of Attorney has become the preferred instrument of
speculators in real estate.
Inspite of the above restrictions,regulation in RE is the only forward
if we are to improve the present state of affairs.
Would welcome inputs on this topic.
- Wiseman I am willing to sell you land in prime localities in Chennai, 100% White. However if I go with you to the Registrar office he wont let you register it at that price. For example a land of mine in Saligramam might fetch me atleast Rs 6000psft, but the registrar will atbest allow me to take Rs 2000psft in white. The remaing Rs 4K is not black for you but for me the seller. Infact that is one main reason I am not able to get off my properties. After all if I could I will rather go and buy a house in USA!CommentQuote0Flag
- Kerala Govt move
There is a proposal from the Kerala Govt to make it mandatory
for the sale agreement to be made a redistered document.
What this means is that the Govt records will start reflecting
the actual sale price of the land.what do u guys think about this move ?
- Builders in Kerala
In my experience none of the reputed builders in Kerala take black money for their upcoming projets. Most of them quote the prices and all the details in their website including the landing cost. Chennai RE market is in the control of black marketers and brokers.CommentQuote0Flag
- that would be a brilliant move... we should have petition filed to have this done all over India.. it is in the common mans and governments interest.
Speculated market just ruin the economy....CommentQuote0Flag
- That argument is disingenuous at best ...Originally Posted by Natarajg007Wiseman I am willing to sell you land in prime localities in Chennai, 100% White. However if I go with you to the Registrar office he wont let you register it at that price. For example a land of mine in Saligramam might fetch me atleast Rs 6000psft, but the registrar will atbest allow me to take Rs 2000psft in white. The remaing Rs 4K is not black for you but for me the seller. Infact that is one main reason I am not able to get off my properties. After all if I could I will rather go and buy a house in USA!
This is a a disingenuous argument at best. Exactly who is the Registrar to deny you registration for whatever price you are looking to exchange property at? He does not have a legal standing to do that. Make life miserable for him/her and they will see the light of day.
Quite an easy excuse to bring in black money into the transaction. You need to take a stand and take the Registrar thru the wringer and there are many tools in the statutes to bring them to heel. This needs to be done by enough people so they come in line. And that is exactly where the problem lies.
Let us not create lame excuses to further our own needs to continue propogating this black money. It starts with us and our need to evade taxes - this thing called greed - that propogates black money. If the penalty was more severe that the benefit, will we continue it?
- Until and unless our Corrupt Politicians are there the regulation in this industry are really difficult. This people has a very big chunk of RE in their booty. They will never allow to introduce some regulation.
- an essential first step
DEar ARin, i think you are absolutely right.However,don't you think
that if sale agreements have to be registered it will discourage ordinary
folks from showing a lower amount in the documents for fear of getting
cheated.This will in turn drive out the speculators who created
such havoc in the market in recent times...:D .Hope other Govts
- GOVT Rate !!!
Showing a lower amount is very dangerous method. I know our people does this to avoid huge amount of Stamp Duty. In India your land is never your land. GOVT can take any time from you paying the actual GOVT rate. It is like taking land as a lease from GOVT. And Ideally I feel that the price in normal market also should be the same. There is many incident where GOVT take the land from the people paying GOVT rate.
Our agent/Broker inflated the market too much. Recently DEVE GOWDA didnt want to give his land for NICE project as that was a future prime location for development. Project was stopped for 3 yrs as he was rulling the KA. But when BJP came to power they gave green signal to NICE authority to Build the road and capturing GOWDA's land. Ha ha .CommentQuote0Flag