Vijayawada: Talk on shift of capital hits realty sector

Vijayawada: Even as the real estate sector was teetering in the state capital region after the new government took charge, some recent talk about shifting the capital location to some other place has led to property prices plummeting.

Everywhere one goes in the 29 villages of the state capital region, and also in and around Vijayawada and Guntur cities, the scenario is similar.

When the state capital was announced by the pervious TD government, NRIs and also people from the state who had settled elsewhere made a beeline to buy property in the capital region. Resultantly, land values shot up.

The sub-registrar’s office at Mangalagiri, which covers the capital region, saw unprecedented activity, and an unprecedented rise in revenue. The weekly revenue in this office at one point of time ran into crores.

Then came the election results and the number of registrations has dropped drastically, some say at 75 per cent of what it was.

The new government’s decision to rake in revenue by increasing registration charges fourfold did not help.

In Mangalagiri alone, the revenue from property registrations was Rs 104,69,16,557 from 23,786 documents from April 1, 2018, to March 31, 2019. This was put at 96 per cent of the target of Rs 109 crore.

However, this financial year, the revenue up to July 31 was Rs 37,20,69,419 from 5,863 documents, only 67 per cent of the target.  With the perceived change in the situation, NRI or locals are not coming forward to purchase lands. 

Hence the land value per acre in the 29 villages of seed capital area has fallen to Rs 2.5 crore from Rs 3.5 crore.

The marked value of land at Tadepalli, was had shot up dramatically after the announcement of an 8-lane express road through the village to Rs 15 crore per acre, has now plummeted to Rs 8 crore to Rs 10 crore per acre.  

According to reports, major investors who had come forward during the TD government are now reluctant to go ahead with the deals since the YSRC government has not yet come out with a comprehensive statement on capital city development. 

The YSRC government, led by Chief Minister Y.S, Jagan Mohan Reddy, has also allocated limited funds of Rs 500 crore to the capital city development. Adding to this, its decision on reverse tenders has also made an impact on the registration of lands.

Meanwhile, the rumours doing rounds over relocation of the capital city, comments of senior YSRC leader and municipal minister Botsa Satyanarayana have created confusion among the local, NRIs and other investors.

Abdul Razzak, a stamp writer from Mangalagiri, said that they were suffering due to the drop in number of registrations after elections. He said that the increase of government valuation of lands also affected the registration process in capital villages. “Registraions have dropped by nearly 75 per cent over the past four months,” Mr Abdul Razzak said.