Friday, 27 March 2015

Delhi govt. lifts restriction on sale of leasehold properties

In a positive development, the revenue department, which banned purchase and sale of leasehold properties in 2011, has asked all registrar offices to allow purchase and sale of leasehold properties.

This has come as a relief to many property owners and is also expected to affect real estate prices. These transactions were earlier done through the general power of attorney.

Officials said that properties that change owners, but registered through the power of attorney or sale agreement, will now be permitted for all related transactions. The department circular says: “It is clarified to all Sub-Registrars that under Section 17 (1-A) of the Registration Act, documents containing contract to transfer for consideration any immovable property is compulsorily registrable document if having been executed after the commencement of Registration (Amendment) Act 2001.

An agreement to sell in respect of immovable property is covered under Section 17 (1-A) of the Registration Act and is a valid document to be registered if so desired by the parties and as such all these documents cannot be refused by Sub-Registrar.

Talking about the impact this decision will have on the property market, Pradeep Misra, CMD of REPL says: “The Delhi government has lifted restriction on sale of leasehold properties. This is a positive decision that will benefit property owners and the real estate sector in a big way.

“Owners in the NCR will now be able to sell their properties with ease. Property owners in areas like Rohini, Vasant Kunj, Dwarka, Janakpuri, etc, were waiting for such a policy for many years now.The government's decision may also fuel price escalation of properties. The removal of these restrictions will open various avenues for the sector and bring the purchase and sale of leasehold properties into effect with the market likely to see an increase in sales.“ Santhosh Kumar, CEO (operations & international director) of JLL India, says this is an extremely positive development and will have a significant impact on the supply side of the Delhi real estate market.

“With the long-awaited relaxation of these norms, people will be able to sell their properties at higher prices,“ Misra said.

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