Bhubaneswar, Sept. 30: If you have purchased plots, flats or independent houses from the development authority and lived there for five years, it's time to convert the property from leasehold to freehold.

The decision of the Bhubaneswar Development Authority (BDA) comes as a huge relief for those who want to transfer or sell properties in leasehold category.

Till the present move was made, leasehold property owners had to make rounds of the BDA office to get a no-objection certificate (NOC) to transfer or sell their plots, houses or flats.

Selling leasehold property took time even for those in dire need of money.

But things have changed after the BDA at its last meeting decided to implement the new rule.

"The authority at its meeting held last week has allowed a property owner to apply for converting the land, house or flat into freehold category after five years of stay. After five years, the allottee can apply to the BDA, deposit an amount of 20 per cent of the government fixed land price and get it registered in his/her name," said allotment officer of the development authority Sibanarayan Nanda.

Once a person converts the property from leasehold to freehold, there will be no objection to selling it, as the individual becomes the sole owner of the land/house.

On the other hand, if a property is in the leaseholdcategory, the owner can still sell it. In that case, the owner will have to apply to the BDA and pay 25 per cent of the differential amount between the property's purchase price and the sale price.

For example, if a person had purchased a land for Rs 20 lakh and is going to sale it for Rs 30 lakh, then the individual has to pay the BDA 25 per cent of Rs 10 lakh or Rs. 2.5 lakh to get the deed done.

"However, as the leasehold status remains unchanged, the person purchasing the land/house has to apply for freehold after residing there five years,'' said Nanda.

He said that the new guidelines were framed to encourage people to apply for freehold as it also makes the authority less burdened.

Clarifying the new regulations of the authority, BDA vice-chairman Krishan Kumar said: "The new regulations are, however, applicable only for residential houses and plots. Properties sold under business categories (such as shops or outlets in market complexes) do not come under its purview.''

On the minimum five-year cap before one can apply for change in the property's status from leasehold to freehold, the allotment officer said: "In principle, the housing schemes and plots were allotted to people who had no land or house in the city. Such property should not be seen as an investment or one that could be sold off soon after purchase. However, after a minimum of five years one can apply to own it and the BDA is not going to see what the owner does with the property.''