Noida Authority halves transfer charges on resale property

[ecis2016.org] The move by the authority will reduce the cost of acquisition of properties in the secondary market.

September 24, 2021: In a move that would significantly lower the cost of acquisition of resale properties, the Noida Authority on September 24, 2021, has reduced the transfer charge by half.

You are reading: Noida Authority halves transfer charges on resale property

During its 203rd board meeting held on September 24, 2021 the Noida Authority decided to cut the transfer of memorandum (TM) fee for the residential category, which includes plots and flats, from 5% to 2.5%.

For the uninitiated, resale is the process under which an existing property owners sells a property that has been allocated by an authority or a builder earlier. This is also known as property sale in the secondary market. Sale of new properties on the other hand is termed as sale in the primary market. The decision by the Noida Authority will act as an enabler for property owners currently planning to sell their properties or plots in areas under the Noida Authority.

Buyers who so far bought property from the resale market pay 5% of total flat/plot cost as the transfer fee. This means that for a home or plot worth Rs 1 crore, a buyer used to pay Rs 5 lakh earlier as the transfer charge. They will now pay only Rs 2.5 lakh.  The new transfer charges will be applicable on property allotted by the authority after 2011.

The move by the Noida Authority comes after directions about it were made by the Uttar Pradesh government earlier. “We have reduced the transfer of memorandum charges in order to provide relief to residents and those who want to buy a property in this industrial town,” Noida Authority Chairman Sanjiv Mittal said after the meeting.

***

Greater Noida Authority cuts Transfer of Memorandum (TM) charges on resale flats by half

June 29, 2021: In a move that might boost home buyers sentiments and trigger a fresh wave of property purchases in this affordable housing market, the Greater Noida Authority has reduced the transfer charge it imposes on the purchase of resale properties by 50%.

The Noida and Greater Noida authorities charge a certain percentage of the transaction value as transfer fee on sale of property in the resale market, also known as the secondary market. When added up to the entire cost, the transfer charges significantly increase the cost of property acquisition.

Also note that the reduction announced by the GNIDA is only applicable in the Greater Noida housing market and not Noida (the Noida Authority has jurisdiction over this housing market).

In a board meeting on June 26, 2021, the Greater Noida Industrial Development Authority (GNIDA) reduced the transfer charges on resale residential land and built-up houses, from 5% of the transaction value to 2.5%. On resale of flats in group housing societies of Greater Noida, the authority has capped the transfer fee at 1%. Similarly, transfer charges on resale industrial, institutional and commercial transactions have been slashed from 10% of the property value to 5%.

The developer community, which has been reeling under the impact of a demand slowdown in this market for years that has been compounded by the Coronavirus pandemic, has welcomed the move. “The decision was taken to reduce transfer charges that will provide a boost to the resale market. The sector needs constant support from the authorities, especially in the current challenging conditions,” said Yash Miglani, MD, Migsun Group.

Meanwhile, the Greater Noida Authority has also approved a one-time settlement (OTS) scheme for its residential allottees. Under the OTS scheme that will remain open till September 30, 2021, allottees who have defaulted on payments, will be able to avoid the hefty penalty they are typically asked to pay. However, this scheme is not meant for people who have already benefited from such a programme in the past. As many as 11,500 allottees will benefit from the GNIDA’s OTS programme, under which the Authority will charge simple interest on additional compensation of 64.7%.

All about Noida’s Transfer of Memorandum (TM) charges on property sale

While property prices in Noida are one of the lowest among all other areas in the National Capital Region (NCR), home buyers purchasing a resale flat here, have to bear an additional cost, known as Transfer of Memorandum (TM) charges. Apart from paying stamp duty and registration charges to the Uttar Pradesh Revenue Department, you will also have to pay this duty, more commonly known as the transfer charge, to the Noida Authority, to get the ownership transferred in your name. This is primarily because land in Noida is sold by the Authority on a leasehold basis to real estate developers and not on a freehold basis. Hence, every time there is a change in ownership of the property, a lease rent has to be paid to the Noida Authority for the same.

Read also : DDA Housing Scheme violated RERA norms, says plea in HC

In this article, we look at the applicability of these charges and how much money a buyer has to pay, to get a resale property transferred in his name.

What are transfer of memorandum (TM) charges?

Unlike some authorities that sell land on a freehold basis, the Noida Authority allocated land to developers on a leasehold basis for a period of 99 years. That way, the Noida Authority continues to be the owner of the property, while the builder has the power only of a lessee. Consequently, the transfer of ownership in case of a leasehold property, requires a permission from the body that has the ownership rights over the said property.

[ecis2016.org] What is a freehold property?

So, each time a property for sale in Noida changes hands, the parties involved have to obtain permission from the Noida Authority, to carry out the transaction and pay it a lease rent better known as the TM charge or the transfer charge. The change in the ownership of properties is permitted, only after the execution of the lease deed.

The process is complete after the registration of the property in the sub-registrar’s office (SRO). After the completion of the registration process, the buyer has to approach the Noida Authority with all the necessary documents and apply for lease transfer and pay the transfer charge. After reviewing the application, the Authority will issue the transfer of memorandum certificate.

Is TM charge applicable for property bought from a builder?

Almost always, the buyer will be responsible to pay the transfer charges as is the case with stamp duty and registration charges. Be advised that only transactions in the resale or secondary market attract a transfer charge and not if you are buying a unit directly from a developer.

It begs mention here that developers in the NCR have a huge unsold stock. ecis2016.org data show that markets in this region have an unsold stock consisting of over one lakh units, as on December 31, 2020. Buyers investing in these properties will not have to pay the transfer charges.

[ecis2016.org] Home sales, new supply improve in Q4 2020 amid festive season: PropTiger report

Transfer charges in Noida

Since its calculation takes place on the basis of circle rates, the transfer charges will vary across areas in Noida.

Transfer charges in Noida for flats

Properties allotted before 1990: 50% of the allotment price.

Properties allotted from 1991 to 2000: 20% of the allotment price.

Properties allotted from 2001 to 2011: 10% of the total allotment price.

Properties allotted from 2011 onwards: 5% of the total allotment price till September 24, 2021

Read also : Self-redevelopment puts societies in complete charge: Pranay Goyal, Wedevelopment

2.5% from September 24, 2021 onwards.

Charges for Sharmik Kunj:  Rs 10,000 per unit

Charges for EWS flats: Rs 30,000 per unit

LIG flats: Rs 60,000 per unit

MIG flats: Rs 1,00,000 per unit

HIG flats: Rs 1,50,000 per unit

Source: Noida Authority

Transfer charges in Noida for residential plots and group housing

Note: Transfer charges on single-storey houses shall be applicable as per residential plots.

Source: Noida Authority

If a property is being transferred in the name of a blood relative, the buyer will have to pay only half the rate as transfer charge. Before 2012, the Noida Authority charged Rs 1,000 as the transfer fee. On properties bought from someone with only a general power of attorney (GPA), the Authority charges double the amount.

Sample of transfer application



(Source: Noida Authority)

Sample affidavit on non-judicial stamp paper



(Source: Noida Authority)

FAQs

Source: https://ecis2016.org/.
Copyright belongs to: ecis2016.org

Source: https://ecis2016.org
Category: Lifestyle