MP Kirron Kher during the press conference at UT Guesthouse in Chandigarh on Friday. Kamleshwar Singh
GIVING RELIEF to the occupants of 50,000 residential properties, the Chandigarh Administration on Friday allowed conversion of residential properties from leasehold into freehold. The administration also gave absolute ownership right to the holder of a general power of attorney (GPA) over the property in Chandigarh.
A detailed notification of the entire process will be issued after a week.
However, conversion rates of leasehold properties into freehold are yet to be announced and it is expected that conversion prices will be decided as per the collector rates of different types of properties. The collector rates are very high in Chandigarh. The collector rate is the lowest at which a property is registered. It is fixed by the administration and revised every year.
The administration has taken the decision after getting the nod of the Union Ministry of Urban Development (MoUD). In January, the Chandigarh Administration had decided to allow conversion of residential properties from leasehold into freehold on the rates fixed as 7.5 per cent to 20 per cent of the collector rate, and sent the proposal to MHA for approval.
The decision was announced by local MP Kirron Kher at the UT Guesthouse. The decision will impact 50,000 residential properties, which are in the shape of housing societies and which were constructed in the late 80s. The houses and flats situated in these societies are being used by the occupants on a leasehold basis.
A leasehold property can be occupied for a limited period, mostly for 99 years, and the actual ownership remains with the UT Administration but in the freehold, the owner is free to utilise it for any purpose. Earlier, the concept of conversion of leasehold into freehold was being used in Chandigarh and the conversion prices were very low. However, the practice was stopped by the then UT Administrator Shivraj Patil in 2013.
Pankaj Khanna, general secretary of Chandigarh Industrial Association, said, “More than 5,000 industrial and commercial properties are yet to convert from leasehold into freehold. Thousands of Chandigarh residents under various associations had been struggling for converting the leasehold into freehold for a long time. We were assured by MP Kirron Kher that commercial properties will also be allowed conversion from leasehold into freehold very shortly.”
Property rates
The decision to convert leasehold into freehold will affect the property rates in Chandigarh. A leasehold owner of a house cannot sell his house to anyone. Sources said earlier, the residential properties, especially in housing societies, were being sold on general power of attorney (GPA) but now these properties can be sold to the purchaser with absolute ownership. The current GPA holder can transfer the properties in their names on the basis of conversion rates.
