New realty launches could trigger price fall: P Lilladher

• Sales registrations down 13% YoY at 4,427

• Slew of launches expected post clarity on new DCR rules and conclusion of BMC elections

• Large supply build-up from new launches could trigger the much awaited price reduction

• Lease registrations up 10% YoY to 9,111

Jan 2012 sales registrations are down 13% YoY and 25% MoM to 4,427. Post the spike witnessed in December, sales registration have reverted this month to ~4000-4500 levels seen in Jun-Nov 2011.

The city’s realty scenario is interestingly poised post the conclusion of the BMC elections and clarity on new DCR rules emerging in the last two months. A number of projects which were stuck up at the approval stage in the last year are likely to be cleared, paving way for a large number of launches hitting the market. At a time when new launches during the festive season received a tepid response as affordability issues continue, a large stock of new supply could act as the trigger for the much anticipated price reduction that buyers have been waiting for in the Mumbai realty market.

Also, we could see more land deals happening as developers are now sure with the introduction of the new DCR of how much they can build and sell. We are already seeing media reports of possible land deals by developers like HDIL who are looking to sell off land to pare debt levels.

In terms of lease transactions, December numbers stood at 9,111, exhibiting a growth of 10% YoY and 8% MoM.

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