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On October 8, 2020, Ladakh became the 34th state/union territory to notify its rules under the Real Estate (Regulation and Development) Act (RERA). This move by the union territory (UT), is expected to usher in a new wave of property development. It was in August 2020 that the UT of Jammu and Kashmir had notified its rules.
Developments after the scrapping of Article 370 in Ladakh
Hindu Succession Act (2005 Amendment)
Despite amendments made to the Hindu Succession Act, Jammu and Kashmir never adopted it However, now, Hindu women in the UT will retain their rights in terms of ancestral property, regardless of whether they are married or not.
Transfer of Property Act 1882 and its applicability
The Transfer of Property Act 1882 is applicable across the country, but wasn’t the case in Jammu Kashmir until now. The Kashmiri Customs and State Regulations on Property Transfers is now no longer valid.
Developments in and around Ladakh
Hailing the move, Durga Shanker Mishra, secretary, Ministry of Housing and Urban Affairs (MoHUA) said that the move will open up new avenues for development of the UT and foster efficient and transparent transactions. The move will also ensure timely delivery of projects and quality of construction.
Authorities say that with Article 370 being scrapped, Ladakh, Leh and Kargil have been getting various benefits on the socio-economic front. For example, the 9.02-km-long Atal Tunnel reduces the road distance by 46 kms between Manali and Leh and the time by about 4 to 5 hours, thereby connecting Manali to Lahaul-Spiti valley throughout the year. This area was previously cut off due to snowfall for nearly six months in a year. With this development, economic progress at a faster pace is expected. Those dependent on hospitality, tourism or even trade will also find better access to the national capital, with this border connectivity project.
On the investment front, the Global Investors Summit generated Rs 14,000 crores worth of investments, making Jammu-Kashmir and Leh-Ladakh-Kargil the hub. Keeping these developments in mind, RREA Ladakh is a step in the right direction, paving the way for housing demand in a regulated ecosystem.
What is the way forward?
Given that Ladakh is a sensitive area, property purchases at the moment are not recommended. Property buyers should take time and wait for the RERA to become established. In the long-term, Ladakh will open up opportunities and the impact will be seen in the way residential, commercial and retail segments catch up, say analysts.
“As of now, the benefit of the Real Estate Act in Ladakh will be seen only in the mid-term. Meanwhile, tourism, retail, entertainment, healthcare, infrastructure and education will catch up,” says Bahadur Bhat, broker in the national capital with experience in the Jammu and Kashmir market. He says that even locals at the moment are cautious and will want to wait, before hurrying to make an investment. Once the dust settles, this will be a lucrative ground for outsiders, as well.
What is Article 35A?
Article 35A has been revoked in Jammu Kashmir. According to this, only permanent residents could acquire land in the state.
What are property prices in Srinagar like?
Property prices in Srinagar are in the range of Rs 2,000 to Rs 4,000 per sq ft.
Is the Ladakh real estate regulatory body already formed?
No, Ladakh has just notified the RERA rules as of now. The regulatory body will be formed soon.