We can buy up Washington DC.

Mr YC Deveshwar, Chairman of ITC, which has a turnover of $7 billion, has just bought a house in Shanti Niketan in Delhi for Rs 85 crores or Rs 850 million. Contrary to the normal practice of paying half the price in cash or black money Mr Deveshwar has paid the entire sum by cheque. Which means that the cost of registering the house and the stamp duty will be calculated on Rs 850 million, adding substantially to the overall cost. His annual property tax will also be calculated on this prices and will be huge. The house has 2 storeys and is built on 800 square yards with a small garden, which works out to Rs 10,62,000 per square yard. Shanti Niketan is supposed to be a posh part of south Delhi but it is congested and the streets are narrow, making car parking very difficult. We do not know how many rooms the house has but from the size of the plot we can guess that it will have around 7-8 bedrooms with attached bathrooms, a drawing room, maybe a study and a kitchen. The sale of this house means that every property in the area will now be valued at the same rate and will have consequent knock on effect on all properties in Delhi. The Delhi government will not miss this chance of squeezing more taxes from the sale of properties and will hike the circle rate, which is a minimum value set by the government on which tax will be collected even if the sale price is less. Rents will also rise and, since only a handful or people can afford to buy houses in Delhi, they will have to pay a greater share of their salaries as rent, increasing poverty. Delhi is to Mumbai what Washington DC is to New York. A 5 bedroom house, built in 1880, with 3 full bathrooms and one partial bathroom on New Jersey Avenue, Capitol Hill, which is where the US Congress is located, is being advertised for $1,299,000 which works out to around Rs 8 crore or Rs 80 million at today's exchange rate, which is one tenth that of Delhi. How can the price of property in Delhi be ten times that in the US when the GDP of the US is $15 trillion while ours is a mere $1.9 trillion. One reason given is the massive population of India in need of housing but if the Food Security Bill is to provide cheap food for 800 million people that leaves 120 million who are thought to be able to buy their own food. The HDFC Bank says that home prices are more affordable now than in 1994-95. At that time it required 22 times annual salary to buy a home whereas now only 4.7 times the annual salary is needed. TOI, 13 May. So who are these rich people? If only 5% of Indians have so much money that makes 60 million people, which is more than the entire population of Britain. So the government has been forcing the RBI to reduce interest rates to help just 5% of people. Why? Because politicians have their black money in property. Maybe these Indians should buy up all the properties in Washington DC and we will end up controlling the US.