Rather, records of Department of Land Reforms (DoLR) show that the sale of land and housing nosedived sharply during this festive season -- a scenario which is different than the trend that used to prevail during the festive season in the past years.[break]
Both transactions and revenue contribution by realty business dropped sharply during this festive season, said Raju Basnet, officer at the department, referring to latest records of five Land Revenue Offices (LROs) of the Kathmandu Valley.
According to the records, the five LROs collected mere Rs 80 million in revenue from land and housing transactions during the month between mid-Sept to mid-Oct, when Dashain festival was celebrated. The LROs in the Valley had collected more than Rs 156 million in revenue during the same month last year.
The offices had mobilized Rs 127.2 million in revenue in the previous month.
“This means; transactions during festive month dropped by more than one-third as compared to the previous month. The drop is still sharper -- almost half - as compared to the same period last year,” said Basnet.
Although LROs remain closed during main festival days, transactions of property used to grow during the festive month in the past years mainly due to sharp increase in inflow of remittances, receipt of bonus and rise in cash holding of service sector employees and professionals. Special discounts and other schemes unveiled by the housing developers and property dealers used to further catalyze the sales upward.
Going by this trend, many developers had unveiled cash discounts up to 15 percent, while others had promised to deliver a car on purchase of stand-alone homes and apartments. For the customers who already own a car, they had even offered to hand over a fully-furnished homes and apartments.
The developers had also expected the business to rebound, particularly as Nepal Rastra Bank (NRB) had recently relaxed issue of personal home loans by allowing banks and financial institutions to exclude such loans up to Rs 80 million from realty loans, which has been capped at 25 percent.
Likewise, the government too had announced that it would not seek sources of income on investments up to Rs 10 million made on land and housing sector.
“The offers were really good; much better than the last year. And both NRB and government´s policies were favorable as well. Still that failed to spur demand,” said Basnet.
Interestingly, the DoLRM records show transactions have dipped the most in Lalitpur, Bhaktapur and western parts of Kathmandu, which used to record highest transactions in the past.
Land and housing transactions have plummeted mainly after NRB intervened in the market
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