Delhi's Property Rates Set to Rise as CM Rekha Gupta Moves to Revise Circle Rates
Delhi Chief Minister Rekha Gupta has announced the formation of a committee to revise the circle rates, which are likely to increase property prices in the national capital. The decision was taken to align the rates with current market conditions and to revamp the real estate system in Delhi.
DelhiProperty RatesCircle RatesReal EstateRekha GuptaReal Estate NewsJun 16, 2025
According to an official statement, the committee, chaired by the divisional commissioner, will submit a report based on current market conditions and property values. This report will serve as the foundation for revising the circle rates. Gupta emphasized the need for simplifying construction-related procedures to make them more transparent and accountable, thereby avoiding unnecessary delays in developmental works.
A circle rate is the minimum price per unit area as determined by the government. It varies from state to state and even within different areas of a city. Factors such as demand and supply, amenities, and the profile of the neighborhood influence these rates, which are subject to periodic amendments. Property registration is not allowed for a price lower than the circle rate for the area.
Delhi has eight categories based on the floor price, with localities divided from ‘A’ to ‘H’. Upscale areas like Jorbagh, Vasant Vihar, and Safdarjung Enclave fall under category ‘A’. Conversely, the least developed areas, mostly in Outer Delhi, are categorized as ‘H’. During the COVID-19 pandemic, the Delhi government had relaxed circle rates by 20%, leading to a significant reduction in prices. For example, the circle rate for category ‘A’ dropped from Rs 7.7 lakh to Rs 6.2 lakh per square metre, while category ‘H’ saw a reduction from Rs 23,280 to Rs 18,624 per square metre. These rebates were eventually withdrawn in 2022, and the 2014 guidelines are currently in effect. The base unit rate of cost of construction for residential use in category ‘A’ is Rs 21,960 per square metre, and for category ‘H’, it is Rs 3,480.
The upgradation of circle rates is expected to increase property prices in the national capital once implemented. This move aims to better align the government’s valuation with the actual market conditions, ensuring a more equitable and transparent real estate market in Delhi.
Frequently Asked Questions
What is a circle rate?
A circle rate is the minimum price per unit area as determined by the government. It varies from state to state and within different areas of a city, based on factors like demand and supply, amenities, and the profile of the neighborhood.
Why is the Delhi government revising the circle rates?
The Delhi government is revising the circle rates to align them with current market conditions and to revamp the real estate system. The current rates are considered to be mismatched with the prevailing market rates.
How many categories are there for circle rates in Delhi?
Delhi has eight categories for circle rates, ranging from ‘A’ to ‘H’. Category ‘A’ includes upscale areas, while category ‘H’ includes the least developed areas, mostly in Outer Delhi.
What impact did the 20% reduction in circle rates during the COVID-19 pandemic have?
The 20% reduction in circle rates during the COVID-19 pandemic led to a significant reduction in property prices. For instance, the circle rate for category ‘A’ dropped from Rs 7.7 lakh to Rs 6.2 lakh per square metre, and for category ‘H’, it fell from Rs 23,280 to Rs 18,624 per square metre.
What is the expected outcome of revising the circle rates?
The expected outcome of revising the circle rates is an increase in property prices in the national capital. This move aims to better align the government’s valuation with actual market conditions, ensuring a more equitable and transparent real estate market.
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