What Is Circle Rate In Real Estate?
In the real estate market of Punjab, the Circle Rate refers to a standard transactional price set by the government, on which properties are purchased and sold. The circle rate is considered while applying taxes on transactions, stamp duty, and registration of properties. Many buyers and sellers are unaware of the fact that the Circle Rate is different from the Market Rate. This confusion raises conflicts between buyers and sellers. If you don’t know anything about these terms, ask a professional real estate consultant like “Cascade BuildTech”.
What Is the Market Rate In Real Estate?
The market rate in the real estate market in Punjab refers to the price of properties set by the market for sales and purchases. It is different from the Circle Rate. Based on the market rate, the deal of a property is finalized by both parties. The market rate can fluctuate based on the demand and supply of real estate products available in the market.
Circle Rate Vs. Market Rate In Punjab Real Estate
- Definition
The Circle Rate is the minimum rate set by the government for property trading in a particular market.
Market Rate is the market-driven price on which the property is actually purchased or sold.
- Determination
The circle rate is determined by the state government based on several factors like demand for location, resale value of the property, supply of products, available resources & amenities, etc. On the other hand, the market rate is driven by the market leaders in the real estate industry. The market rate is considered as the actual current price of the property.
- Flexibility
The nature of the market rate is dynamic and flexible. It keeps on changing as per the demand and supply of properties. It is so fluctuating that you can experience a change in price within a month or two. Market leaders keep on driving the market rate of different types of properties. However, the circle rate is fixed & channelized by the government. Once it is set based on the major factors, can’t be changed.
- Implementation
The registration fees and stamp duty for the targeted property are calculated and imposed based on the set circle rate. Many buyers are unaware of this fact. If you still have any doubts, you can talk to a professional realtor. On the other hand, the property is purchased and sold based on its current market rate. The market rate may decrease or increase because of the fluctuation in demand & supply.
- Relationship
The market rate is always higher than the circular rate. Similarly, the circle is always lower than the market rate. Although these two rates are different from each other, both are applied to a single trade transaction of the focused property.
Benefits Of Knowing The Difference Between Circle Rate And Market Rate
- You can avoid facing certain issues related to your budget. It is advantageous to know the exact calculation of the circle rate and market price of the targeted property. It will help you to measure, how much finances you need to arrange from the outside.
- It is beneficial for a buyer to know about applied property rates. It helps you negotiate a better deal. If the deal price is less than the market rate, then that deal is profitable for you.
- Being aware of the circle & market rates can encourage the genuine deal.
- It is better if you know the difference between both rates can help you plan your budget smartly.
- Having a better understanding of both rates can help you find better investment opportunities in the real estate sector, especially in the Punjab Real Estate Market.
- If you are looking for home loan options, knowing about the circle rate and market rate can help you calculate the exact loan amount needed for the deal. The smaller margin between both rates encourages financial institutions to sanction your home loan early.
Conclusion
Now, if you understand the importance and implications of both rates on properties, you can invest in the most lucrative 3BHK flats in Zirakpur with premium location advantages. This information will help you make quality property-buying decisions in the future.