Real estate transactions have declined as land division has stalled in most municipalities in the country and more than two dozen land reform and land revenue offices across the country were damaged during protests on 24 Bhadra. With the decline in transactions, government revenue from the purchase and sale of real estate has also decreased.

The Land Management and Records Department has stated that a revenue of Rs 2.75 billion 85 million was collected in Asoj last year.

Real estate transactions have been continuously decreasing in Bhadra and Asoj compared to Shrawan since the current fiscal year. While Rs 3.14 billion in Bhadra was collected, Rs 3.28 billion in Shrawan was collected. The Land Management and Records Department has stated that revenue collection is normal despite the festive season. In Asoj last year, Rs 213 million 75 thousand in service tax and Rs 1.44 billion 16 million 87 thousand in registration fee were collected. Capital gains tax has been collected at Rs 1.6 billion 19 million 35 thousand 537.

According to the department, the Land Revenue Office, Chabahil, Kathmandu, has collected Rs 274 million 42 million 96 thousand 210, and the Kalanki Land Revenue Office, which was damaged by fire and vandalism, has collected Rs 4150 thousand 371 in revenue.

Similarly, the Land Revenue Office, Butwal collected Rs 53,56,639, the Land Revenue Office, Damak, Jhapa collected Rs 28,641,390, and the Land Revenue Office, Manmaiju, Kathmandu collected Rs 47,723,361, the department said.

In Asoj, 23,353 deeds were passed. There were 2,442 transfers, 23,914 withholdings, and 17,930 releases. According to the department, there were 79,739 real estate-related transactions in Asoj.

There has been a sharp decline in real estate transactions in Asoj compared to last Bhadra. The total real estate transactions in Shrawan were 1,4218, while in Bhadra, they were limited to 1,2971. But the department has data that only 79,736 real estate transactions were made in Asoj. There has also been a decrease in the number of plots during this period.

While 42,563 plots were made in Shrawan last year, 37,553 plots were made in Bhadra. The department has data that 35,349 plots were made in Asoj last year. This is the lowest real estate transaction and revenue collection since Kartik 2080. In Kartik 2080, 77,185 real estate transactions were made, and revenue collection was 2.16 billion 3.8 million rupees.

Bishnu Ghimire, President of the Nepal Real Estate and Housing Development Federation, said that the transaction could not increase due to the closure of plots and damage to more than two dozen land revenue offices. "Now is the season for real estate transactions. People from abroad used to come during Dashain-Tihar to buy real estate, but the land division in most municipalities is at a standstill. In some places, the land revenue offices are destroyed," he said, "That is why real estate transactions have not increased, but have decreased."

According to the Ministry of Land Management, Cooperatives and Poverty Alleviation, 253 municipalities have been classified in terms of land divisions. However, the ministry says that 500 municipalities are in various stages of classification. Therefore, the government understands that land division has been stopped in only 500 municipalities. Ganesh Bhatta, spokesperson for the Ministry of Land, said that the Land Use Regulations, 2079 (third time) have been sent to the Council of Ministers for amendment to clarify the land division. ‘We have sent the Land Use Regulations, 2079 (third time) to the Council of Ministers for amendment,’ he said, ‘no decision has been made.’

The government has already amended the Land Use Regulations, 2079 twice to clarify the land allocations when municipalities did not classify them on time. Land administration work, including land allocations, had been halted in 620 municipalities since the beginning of Bhadra 2081. At that time, only 133 municipalities had classified their land completely. Immediately, on Bhadra 27, 2081, the Land Use Regulations, 2079 were amended for the second time, giving municipalities until Asar 2082 to classify their land. The ministry has stated that only 253 municipalities had classified their land completely by Asar 2082, while land allocations had been stalled in 500 municipalities.

When the regulations were issued in Jestha 2079, four forts had to be opened and agricultural areas had to be designated within 6 months. By Mangsir 2079, only a few municipalities had allocated agricultural areas. After Mangsir 2079, land was to be classified into all 10 zones. However, after most municipalities failed to classify the land, the regulation was amended on 32 Shrawan 2080 and a provision was made to designate agricultural zones by opening four forts within a year.

The first amendment to the regulation allowed residential and commercial land to be divided into plots up to 80 square meters and agricultural land up to 1 ropani. Earlier, residential land could not be divided into plots less than 130 square meters. In the case of agricultural land, there was a provision that plots could not be divided into plots less than 500 square meters in the valley and 675 square meters in the Terai and inner Madhesh.

The land classified by the government has separate criteria for agriculture, residential and commercial. The regulation states that local road standards must be met for commercial housing. After the municipality did not classify it even after extending the period by one year from the first amendment, the ministry amended the regulation for the second time in 2081 Bhadra.

Even after amending the regulations twice and extending the time for land classification, 500 municipalities have not classified their land. When the regulations were amended for the second time, the Law Ministry had already told the Land Ministry not to amend it. However, since the Land Ministry is holding discussions to amend the regulations again, the question has arisen whether the Law Ministry will give its consent or not, said an official of the Law Ministry. However, Bhatta, a spokesperson for the Land Ministry, claimed that discussions for amending the regulations have only begun.

Three years after the Land Use Act, 2076 was enacted, the government had started classifying land by issuing regulations on 23 Jestha 2079. The Land Use Act, 2076 provides that the Land Use Council formed at the local level should implement land classification and land use policies based on the maps and details provided by the government.

Permission to transact real estate worth more than 30 million at a time

Meanwhile, on Asho 27, the government issued a notification in the Gazette stating that companies transacting real estate worth more than 30 million rupees at a time would have to obtain permission. Now, companies that transact real estate exceeding Rs 30 million at a time will have to obtain a permit. It has been made mandatory to obtain a permit when buying and selling real estate exceeding Rs 30 million at a time through a company within metropolitan and sub-metropolitan cities across the country.

The government will have to obtain a permit if real estate transactions of any area within metropolitan and sub-metropolitan cities are carried out through a company. The government has published a notice in the Gazette for the purposes of Section 26 (a) and (b) of the Land Revenue Act.

Section 26 (a) of the Land Revenue Act states that a license must be obtained to conduct real estate transactions. The said section states that a license must be obtained when conducting real estate transactions exceeding the area or amount specified in the same notice published in the Gazette by the government.

Section 26 (b) states that an application for a license must be submitted. Sub-section 1 of Section 26, ‘B’ states that a person desiring to obtain a license to conduct real estate transactions shall submit an application to the designated authority by the Government of Nepal by publishing a notice in the Nepal Gazette along with the prescribed details, documents and fees. The Director General of the Department of Land Management and Records has been designated as such authority.

Sub-section 3 of the same section states that if the application received is found to be reasonable, the concerned authority shall issue a license to conduct real estate transactions to the applicant, stating the prescribed conditions. The term of the said license shall be for five years, as mentioned in Sub-section 4 of Section 26, ‘B’.