The stamp duty cut period between September 2020 and March 2021 saw as many as 80,718 properties registered in Mumbai alone - a growth of 114 percent against the same period last year (September 2019 to March 2020), as per data by the Inspector General of Registration (IGR), Maharashtra.
In the corresponding period a year ago (September 2019 to March 2020) when there was no stamp duty cut, around 37,725 properties were registered, according to the data.
The total revenue collected in Mumbai between September 2020 and March 2021 (period of stamp duty cut) was Rs 2,914 crore, almost the same as in corresponding period a year ago (at Rs 2,958 crore), an analysis by Anarock has said.
The latest government data already indicates a drop in property registrations in April 2021 over March 2021 amidst the second COVID-19 wave and no stamp duty cuts.
In short, the increased sales volumes aided by the stamp duty cut helped the government avoid severe revenue loss. Ever since the expiry of the stamp duty cut period from April 1 onwards, there has been a marked drop in property registration numbers.
Besides the expiry of the stamp duty cut period, the second COVID-19 wave and ensuing restrictions aimed at curtailing the city’s caseload have contributed towards the declining numbers.
The second COVID-19 wave coupled with the expiry of the stamp duty cut period will impact the monthly growth momentum of Mumbai's housing sector. During the period of stamp duty cuts, there was consistent M-o-M growth in sales, an analysis by Anarock has said.
However, the April-June quarter will certainly be impacted by the rapid spread of the virus. Already, restrictions on interstate movement and the call to steel manufacturers and fabricators to allocate their oxygen supplies to the hospitals have put pressure on the supply chain.
Despite the stamp duty cuts in this period, the state government collected almost the same volume of registrations revenue as it did last year in the same period. The total revenue collected stood at Rs 2,914 crore between September 2020 and March 2021 period, while it was Rs 2,958 crore in the corresponding period a year ago.
Clearly, the stamp duty cut significantly stimulated housing demand in the city. The government would do well to seriously consider extending it to keep the property sales momentum - and registrations revenue – going, the analysis said.
It is an apt time to consider such a move as the second wave has proved to be far more serious than the first one. Overall, the housing sector is better equipped this time around as more developers have developed digital marketing capabilities and the government has allowed construction activities to continue, the Anarock report added.