ASR is a government tool to find out the minimum value of a property at different locations based on various market factors. In Delhi, it is called Circle Rate whereas; in Mumbai, it is known as Ready Reckoner Rate (RR rate).
Following are some of the key aspects about ASR that property buyers should know:
- Normally, ASR is typically lower than the prevailing market rate of the property in a location;
- The government calculates the minimum stamp duty and registration charges based on the prevailing ASR value in the area;
- ASR is reviewed from time-to-time and the government tries to keep it close to the prevailing market rate in the area.
“The Annual Schedule of Rates is prepared to assess the market value of a property to calculate the stamp duty as applicable on the said property. These rates are determined by the Stamps and Registration Department of the state of Maharashtra. The ASR helps individuals find the official rates for properties in a particular area,” explains senior faculty, Vidya Bhagwat, faculty department, REMI.
Experts point out various terms of ASR rates as known in the key cities across India:
- Circle Rate Delhi, Bhubhaneshwar;
- Guidance Value Bengaluru, Hyderabad;
- Guideline Rate (Market Value) Chennai;
- Guideline Rate Kolkata;
- Ready Reckoner Rates Mumbai;
- Jantri Rates Gujarat.
ASR impacts the property prices:
“In cities like Bengaluru and Mumbai, the ASR is now very close to the actual prevailing market rates in most areas and for most asset classes. Thus, they are a good benchmark for the buyer. However, buyers should note that rates will vary from property to property depending on the quality of specifications, micro-location characteristics, reputation of the developer, payment terms, etc,” says Amit Oberoi, head of valuation and advisory at Colliers. He further goes on to add, “It is necessary to set a realistic ASR level, so that the government can realise the actual revenue that is used for public good. Also, the government should consider lowering the stamp duty and registration rates, so that there is a greater disclosure of transaction values.”