Gujarat’s new jantri rates threaten to spike housing prices by 30-40%

Days after the Gujarat government proposed a revision of “jantri” rates — benchmark land rates decided by the government — real-estate developers associated with Credai on Tuesday said the new rates would push the prices of new housing projects in Gujarat by 30-40 per cent. “Our preliminary analysis shows that the Gujarat government raised Jantri rates on an average between 200-2,000 per cent of what was in existence. This hike does not look scientific or rational and such a sudden hike will adversely affect ongoing projects and cause a 30-40 per cent price increase in new projects,” said Dhruv Patel, president of Credai-Ahmedabad, on Tuesday. 

Jantri rates in Gujarat are ready reckoner rates decided by the state government and applicable to any property bought or sold in the state. The government sets the rates based on periodic assessments of property values, market conditions, and other factors.

“The proposed hikes are more in rural areas and less in urban areas. If the prices of houses and other real-estate go up by 40 per cent all of a sudden, how will people afford them,” he added. On November 20, the Gujarat government placed the draft “Annual Statement of Rates 2024”, commonly known as Jantri, in the public domain and invited suggestions and objections. December 20 is the last date for feedback on the draft rates.

Pointing out how the Gujarat government has already doubled jantri rates in March 2023, Patel said, “We are not against the government raising the rates. But it cannot be sudden. Just 18 months ago, the government had increased the rates. Any future increase has to happen in phases.” Credai members said that the proposed hike in rates will affect ongoing projects as customers will have to pay higher stamp duty rates. Real-estate developers also said that the projects under redevelopment in urban areas like Ahmedabad will also be “unviable.”

“Real-estate projects will come to a stand-still as long as there is no clarity on the new jantri rates from the State government side,” Patel said seeking more time from the State government.