What are ready reckoner rates, and what do they entail?

What is the rate of Ready Reckoner?

The Ready Reckoner rate, often referred as circle rate, is the minimum valuation at which a property must be recorded in the event of a sale. All state governments release area-wise quick reckoner rates of properties on a yearly manner to avoid stamp duty fraud via loss in value of agreements and to reduce disagreements concerning stamp duty quantum. Maharashtra, for example, provides a quick reckoner rate for Mumbai.

Importance of the ready reckoner/circle rate

In Mumbai, the Ready Reckoner (RR) rate is known to as the Circle Rate. In Delhi, it is known to as the Circle Rate. The government’s assessment of minimum property values in different locations is known as the readymade reckoner rate Mumbai. Each state, city, and neighbourhood inside those cities has a different rate. Authorities use a number of elements to assess the price of real estate in a certain area. Depending on such characteristics, a baseline is established under that no property sale within this area is permitted. This rate is referred to as the Ready Reckoner/Circle rate. It is the lowest price at which stamp duty and registration fees will be charged by the government.

Example: Now, how do you figure out the ready reckoner rate? Assume you buy a residential home for Rs 6,500 per sq ft on the open market. Whereas if regional ready reckoner rate is Rs 5,500 per sq ft, you would have to pay stamp duty and registration fees on the greater value, i.e. the sale price. In just about any case, property registration in that area cannot be done for less than the ready reckoner rate’s minimum value.

Ready Reckoner rates are usually lower than actual market rates for properties in a given location. The Ready Reckoner rate is evaluated and altered on a regular basis to keep it nearer to market rates. Because real estate transactions are often private and the price is not revealed, state governments want a benchmark to guarantee that they do not miss out on a significant source of income.

How do you calculate the ready reckoner rate?

Determine the property’s constructed space (understanding what sort it is—a flat, a commercial unit, etc.) and include aspects such as floors, facilities, building age, and size. If two numbers for built-up area are given – the initial or the one with 1.2 times the carpet area – take the higher value into account. Choose the property’s area and use the formula below to compute the value of the property based on the ready reckoner rate.

If it’s a flat, use the following formula:

• A property’s built-up area multiplied by the ready reckoner rate for apartments in rupees per square meter
• For the property, covered parking spots x a 25% ready reckoner rate per unit area
• open parking spaces x 40% of the zone’s ready reckoner rate of developed area

The significance of Ready Reckoner rates cannot be overstated

The RR rate of properties in a certain location is a strong indicator of how much money a prospective house buyer had to spend. Whenever the RR rate is predicted to be increased, market rates of properties are usually higher, therefore property prices in an area inevitably rise. It is also advantageous for buyers to purchase property in an area in which the gap between both the ready reckoner rate and the market rate is comparatively small, particularly if the acquisition is funded through a home loan.

What are the best places to look for ready reckoner rates?

Visit the government websites to find out what the latest ready reckoner rates are in a specific area. The government adjusts the ready reckoner rates on a regular basis. Visit the IGR Maharashtra website to see the ready reckoner rate in Mumbai. The Maharashtra government’s registration and stamps department is in charge of compiling an Annual Report of Rates, often known as ready reckoner rates.

Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. PropertyPistol does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.