UP govt proposed hike in circle rate may hit property demand

New Delhi: The Uttar Pradesh government's proposal to increase circle rates in Noida would increase the cost of acquisition of properties and affect demand, rating agency ICRA said today.

The circle rate is the minimum rate at which a transfer/registration of a property takes place and the government earns revenue by levying stamp duty on the registration value.

"The proposal, which is currently open for public opinion until July 25, 2016, involves increasing the circle rates ranging from 15 per cent to 25 per cent. This, along with the proposed increase in the stamp duty in Noida from 5 per cent to 7 per cent, will further lead to a rise in the acquisition cost of real estate at a time when the industry demand is already muted," ICRA said in a statement.