Residents of housing societies situated on collector's or leasehold land are requesting a reduction in the premium fees imposed for converting the land to freehold status. They seek a decrease from the current rate of 15 percent of the ready reckoner (RR) rate to a more reasonable 5 percent. The request was put forward at the recent gathering of the State Sahakar Parishad held last week. The chief minister, deputy CM, and revenue minister were all present at the meeting.
Residents of housing societies situated on collector's or leasehold land are requesting a reduction in the premium fees
imposed for converting the land to freehold status. They seek a decrease from the current rate of 15 percent of the
ready reckoner (RR) rate to a more reasonable 5 percent. The request was put forward at the recent gathering of the
State Sahakar Parishad held last week. The chief minister, deputy CM, and revenue minister were all present at the
meeting.
According to Suhas Patwardhan, the Maharashtra State Cooperative Housing Federation's vice-chairperson, the
decreased fees would serve as an incentive for a greater number of housing communities to choose to convert.
Previously, the cost was equivalent to half of the RR. Eventually, it decreased to 15 percent. An additional decrease is
required. He mentioned that additional residential societies would step forward.
Majority of these residential communities are in a state of disrepair and require immediate renovation. According to a
member of the housing society, the redevelopment is not feasible due to the steep premium involved. Ramesh Prabhu,
the Chairman of the Maharashtra Societies Welfare Association, highlighted that flat owners encounter difficulties
when it comes to both reselling their properties and carrying out renovation projects if their societies do not choose to
convert to freehold status.
Currently, for every flat that is being sold again, an NOC from the collector is a mandatory requirement. Even with the
payment of transfer fees, the process remains long and arduous. Despite the redevelopment process, society still
necessitates an NOC and demands a premium of 15 percent of the RR value of the land to be paid. Obtaining the NOC
from the collector requires a time period of over one year. He mentioned that, in addition, there is a need to bear the
extra expenses of collaborating and hiring professional services. He remarked that the GR that was approved on
March 9, 2019, is biased because Nagpur is only charged with 5 percent.
He recommended that the societies submit applications for changing from Class II to freehold status to the collector,
and that the premium of 5 percent be obtained from the developer designated by the society for redevelopment.
Freehold property refers to an estate that is solely under the ownership of the proprietor, without any external entity
having a hold over the freehold premises. It is exempt from any additional payments such as ground rent, service fees,
or any similar costs that would otherwise be applicable to leasehold properties.
Leasehold property is when a property is leased to another person. The lessor owns the property while the lessee
leases it. The leased property is called the leasehold. Buyers of leasehold properties do not hold ownership rights to
the house or land until it is converted to freehold. If not done, he continues as a tenant and pays rent to the leaseholder
until the lease ends.
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