The Noida and Greater Noida real estate markets, popular among home buyers for their wide range of housing projects, are now facing new challenges due to recent regulatory changes. The Noida-Greater Noida Authority has implemented a new rule requiring the registration of Builder-Buyer Agreements, which is expected to add a considerable financial burden on those looking to invest in these areas.
What’s in the New Rule?
Under the new rule, buyers will be required to register their Builder-Buyer Agreements with a non-refundable fee of 1% of the property cost. This fee, along with the existing 6% stamp duty, is becoming a concern for buyers, as it adds a substantial extra cost. In contrast, other states charge a nominal stamp duty fee ranging from ₹1,000 to ₹10,000 on similar agreements.
Industry experts argue that this rule creates additional financial pressure on buyers, who already have to make significant initial payments at the time of booking. Now, they will also need to cover this extra fee, making property purchases in Noida and Greater Noida more expensive.
CREDAI’s Reaction to the Rule
The Confederation of Real Estate Developers’ Associations of India (CREDAI) has expressed concerns over this decision, warning that it could harm the real estate market. Manoj Gaur, Chairman of CREDAI and CMD of Gaur Group, criticized the rule, stating that it places an unfair financial burden on buyers. Gaur pointed out that 15-20% of bookings typically get canceled due to various reasons, a figure recognized by RERA (Real Estate Regulatory Authority). With the new non-refundable fee, buyers who cancel their bookings would lose a considerable sum without any clear refund policy, potentially worsening their financial situation.
Challenges for Home Buyers
For buyers, the non-refundable aspect of the new registration fee is especially concerning. If a buyer decides to cancel a booking for any reason, they could face a significant financial loss due to the 1% fee that won’t be refunded. As buyers often need time to arrange funds for property investments, the additional cost could push them to reconsider their options or look outside the Noida and Greater Noida regions.
Impact on Real Estate Market in Noida and Beyond
This decision has sparked worries in the real estate sector. CREDAI believes that the new rule may discourage buyers and dampen growth in Noida, Greater Noida, and along the Yamuna Expressway. Real estate plays a major role in the state’s economy, and such changes could impact investor interest, potentially slowing down the region’s growth.
So far, the Noida-Greater Noida Authority has not announced any adjustments to the rule or considered any potential changes to address these concerns.
