Gujarat Government Caps Housing Society Transfer Fees

Gandhinagar : In a major move to protect homebuyers from arbitrary charges, the Gujarat government has introduced new rules under the amended Cooperative Act. According to these regulations, housing and housing service societies cannot charge a transfer fee exceeding 0.5% of the total consideration amount or a maximum of Rs 1 lakh during the purchase or sale of a house.

Announcing the decision, Gujarat’s Cooperation Minister Jagdish Vishwakarma stated that the government had been receiving complaints about societies levying excessive transfer fees in the absence of clear legal provisions. The new rules aim to regulate these charges and prevent undue financial burdens on homeowners.

30,000+ Housing Societies to Be Regulated

Gujarat has over 30,000 housing and housing service societies governed by the Cooperative Act. Traditionally, when a property changes hands in these societies, the management committee collects a transfer fee from the buyer. However, in the absence of a clear cap, societies were reportedly charging excessive amounts, leading to widespread grievances.

Recognizing the need for intervention, the state government amended the Cooperative Act in 2024, introducing the new transfer fee cap. The move is expected to curb financial exploitation and bring transparency in housing society transactions.

Relief for Homeowners & Legal Heirs

Minister Vishwakarma emphasized that societies will not be allowed to charge any fee beyond the prescribed limit and may even choose to set a lower transfer fee through their bye-laws. He also clarified that if a property is transferred to a legal heir without any financial consideration, no transfer fee will be applicable.

Additionally, societies cannot demand any charges in the name of development fees, donations, or any other hidden costs at the time of property transfer. This ensures that buyers and sellers are not unfairly burdened with extra expenses.

Ending Arbitrary Practices in Housing Societies

The misuse of power by society presidents, ministers, and committee members has been a longstanding issue, leading to harassment of homeowners. This decision aims to put an end to such arbitrary practices and empower residents with clear legal protection.

“The new rules will bring regularity in the functioning of housing societies and provide huge relief to lakhs of homeowners across Gujarat,” said Vishwakarma. The move has been widely welcomed by residents and real estate experts, who see it as a step toward greater transparency and fairness in housing society operations.