The Punjab government has taken a bold step to breathe new life into stalled public assets. In a significant policy decision, authorities have approved a substantial reduction in reserve prices for properties that failed to sell through the Greater Mohali Area Development Authority (GMADA).
Major Price Cut for Unsold Properties
Finance Minister Harpal Singh Cheema announced the new policy after a thorough review of government-owned properties that remained unsold despite multiple auction attempts. The committee discovered that unrealistically high reserve prices were the primary reason these properties failed to attract buyers.
Under the approved framework, the reserve price of unsold GMADA properties will drop by an average of 22%. This strategic reduction aims to generate substantial revenue for the state, estimated between Rs 5,000 crore and Rs 10,000 crore.
How the New Pricing Mechanism Works
The government established a clear process for determining new reserve prices. Three independent valuers empanelled with GMADA-PUDA will assess each property. Their average valuation becomes the new reserve price, subject to approval by competent authorities.
This price reduction applies specifically to properties that remained unsold in two or more consecutive e-auctions. The revised prices will remain valid for one full calendar year, providing stability for potential buyers.
What Happens If Properties Still Don't Sell?
The government has built flexibility into the policy. If properties continue to remain unsold after the initial price reduction, authorities may apply additional cuts. After obtaining necessary approvals, a further 10% reduction could be implemented, followed by another 5% if needed.
Wide Range of Affected Properties
GMADA's unsold inventory represents diverse property types. The list includes residential plots, commercial booths, group housing sites, industrial plots, institutional plots, and even hotel sites. Many of these properties have failed to sell for five years despite repeated e-auction attempts.
The new policy extends beyond GMADA to cover all development authorities in Punjab. It applies to residential, commercial, industrial, and institutional sites across the state.
Real Estate Industry Welcomes the Move
Industry stakeholders have expressed strong support for the government's decision. They believe the price reduction will provide a major boost to GMADA and accelerate transactions throughout the real estate ecosystem. The upcoming auctions, led by GMADA under the housing and urban development department, represent one of North India's largest government-led real estate monetization drives in recent years.
Broader Economic Objectives
The policy serves multiple economic purposes. First, it aligns reserve prices with current market conditions, making properties more attractive to buyers. Second, it aims to revive buyer interest in stalled public assets. Third, it helps ease fiscal pressures on the state government by generating much-needed revenue.
This initiative forms part of a larger strategy to monetize stalled public assets across Punjab. By creating fresh opportunities for investors and end-users to acquire properties at realistic prices, the government hopes to stimulate economic activity and development in the region.
The move represents a practical approach to addressing long-standing inventory issues while supporting the state's financial health and promoting sustainable real estate development.
