The year 2021 saw the highest residential registrations in Mumbai Metropolitan Region in recent times as over Rs 1.9 lakh crore worth of homes were sold.
The property registrations too increased by 53% in Mumbai Metropolitan Region (MMR) on the back of stamp duty cut by the Maharashtra government, a research report titled MMR Housing Uptick Aided by Support, conducted jointly by CREDAI MCHI, Colliers and CRE Matrix said on January 24, adding that low-interest rates on home loans too was a factor.
Registration of residential properties stood at 2,42,061 units during 2021 as against 1,58,327 units in 2020 and 2,01,613 units in 2019.
The value of property registered stood at Rs 1.9 lakh crore last year, Rs 1.12 lakh crore in 2020 and Rs 1.29 lakh crore in 2019. The registration data comprised units sold in primary and secondary (resale) markets.
Boman Irani who is now the incoming president of CREDAI-MCHI said that the stamp duty collections of the government also rose 81 percent year-on-year in 2021, almost touching the 2019 level.
Colliers India CEO Ramesh Nair said besides the stamp duty reduction, low home loan rates, stable housing prices, pent-up demand, and discounts offered by builders contributed to rise in registration numbers, adding that it is now the right time to buy a house.
Central Mumbai (Dadar, Lower Parel, Worli, Sewri, Mahim, Matunga, Parel, Wadala) saw the maximum revival in sales in 2021. Registrations here rose 93% from 2019 and 71% from 2020. Thane accounted for the highest number of registrations with a 42% share, and the highest stamp duty collection.
Within the MMR property market, the registration of homes in Thane increased to 1,02,054 units during last year from 69,434 units in 2020 and 94,154 units in 2019. Within the MMR property market, the registration of homes in Thane increased to 1,02,054 units during last year from 69,434 units in 2020 and 94,154 units in 2019.
Palghar saw the registration of 28,678 units last year as against 20,357 units and 26,280 units in the previous two years, respectively. Homes registration in Raigad rose to 34,192 units in 2021 from 22,775 units in the previous year and 32,725 units in 2019. Homes registration in Raigad rose to 34,192 units in 2021 from 22,775 units in the previous year and 32,725 units in 2019.
As many as 12,023 units got registered in Mumbai City last year. In 2020 and 2019, 7,025 units and 6,593 units were registered, respectively. Registration numbers in Mumbai Suburban grew to 65,114 units in 2021 from 38,736 units in 2020 and 41,861 units in 2019.
The cut in stamp duty gave a fillip to affordable and mid-segment (less than Rs 1 crore). Property registrations in these segments rose 22 percent in 2021, over 2019. The cut in stamp duty gave a fillip to affordable and mid-segment (less than Rs 1 crore). Property registrations in these segments rose 22 percent in 2021, over 2019.
Demand in the luxury segment bounced back after several years. Sales in the luxury segment (Over Rs 3 crore) almost doubled in 2021, compared to 2019. Luxury sales accounted for the highest share in three years, at 28% of the sales in 2021. The majority of the sales were in Central Mumbai, followed by Western Suburbs, the report said.
In MMR, the trigger in home sales in 2021 led to 81% higher stamp duty collections YOY, almost touching 2019 levels. The Brihanmumbai Municipal Corporation (BMC) also saw a massive upsurge in premium collections as it crossed Rs 11,000 crore before the end of December 2021. The average collection over the past 10 years have been in the range of Rs 3500- 4000 crore, which shot up manifold.
At the same time, in FY 2020-21, property tax collections hit a 10 year-high with collections of Rs 5,135 crore meeting 98% of the projected. Property tax is the second biggest source of revenue for the municipal corporation of Greater Mumbai after Goods and Services Tax (GST).
The Maharshtra government in September 2020, reduced stamp duty charges from 5% to 2% for all residential transactions for the period September to December 2020 and 3% for the subsequent quarter of January - March 2021.
“A series of positive actions and continuous encouragement by the Maharashtra government ensured that the real estate sector and the overall economy get a boost. Premium reductions led to 5x collections as compared to an average year, Irani said.
Adding that the reduction in stamp duty helped in doubling the number of flats sold. Notably, almost Rs 1.30 lakh crore worth of residential flats were sold in the period of October 2020 to March 2021. All of these led to an indirect collection of GST wherein the state received 9% of the construction costs as GST and further 2.5% GST on the value of apartments sold,” said Bomani.
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