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State government holds back RR rate hike for open lands

The stay aims to enable construction of affordable housing in the Metropolitan Region

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Chief Minister Devendra Fadnavis informed the state legislative assembly on Monday that the stay is on the hike in RR rates for land in Mumbai
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The state government has stayed the hike in ready reckoner (RR) rates for open land in the municipal corporations and councils in the Mumbai Metropolitan Region (MMR) to enable construction of affordable housing projects.

Chief Minister Devendra Fadnavis told the state legislative assembly on Monday that the stay had been given on hike in RR rates for land in Mumbai. "The municipal corporation levies charges based on RR rates," he said, adding that this affected affordable housing projects with the fees having a cascading effect of around 90 per cent.

"To prevent this cascading effect, we have imposed a stay for one month," said Fadnavis.

A senior revenue department official said the stay imposed on May 19 will be in force in nine municipal corporations (Mumbai, Thane, Kalyan-Dombivali, Ulhasnagar, Mira Bhayander, Bhiwandi Nizampur, Vasai Virar, Panvel and Navi Mumbai) and eight municipal councils in the MMR. These eight councils include Kulgaon-Badlapur, Ambernath, Karjat, Alibag, Pen, Uran, Matheran and Khopoli.

The old RR rates for 2016-17 will apply for transactions on open lands in these areas as against the new RR rates which came into force on April 1. The RR rates for open lands had been hiked by an average of around 5-7 per cent for 2017-18.

"This stay will only cover open lands and not the RR rates for flats, commercial property and industries," the official said, adding that the department of registration and stamps will come out with fresh rates within a month.

The official said that the decision had come after representations by stakeholders like developers and construction industry bodies. "Municipal corporations levy charges like premium on fungible FSI based on the prevailing RR rates," he explained, adding that however, there was little open land available for construction and development in cities like Mumbai and Thane.

...and analysis

Though sops have been granted by governments to the construction industry in the past, these have not translated into affordable housing. Authorities need to ensure that middle, lower middle class get adequate housing in MMR.

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