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Over 11,700 properties registered for sale in Mumbai in April 2022

Consumers advanced their purchase by filing in March 2022 while registering them in April 2022, effectively saving 1% metro cess on their deals

The ready reckoner rates of all municipal corporations in Maharashtra except Mumbai will go up.

The ready reckoner rates of all municipal corporations in Maharashtra except Mumbai will go up.

April 2022 saw record property sale registrations of 11,744 units in Mumbai, contributing over Rs 738 crore to Maharashtra's revenue, showing data from the Inspector General of Registration, Maharashtra.

The state capital saw sales registrations of 16,726 units in March 2022. This was primarily because buyers advanced property purchase to save the metro cess levy that kicked in on April 1. Consumers moved their purchases forward by filing in March 2022 while registering them in April 2022, effectively saving on the 1 percent metro cess on their deals.

Up to 82 percent of property registrations executed in April were filed in March 2022 at an effective stamp duty rate of 5 percent, whereas 17 percent of properties registered in April 2022 and filed in April 2022 had to bear an effective stamp duty rate of 6 percent. The rest were filed between December 2021 and February 2022 and escaped the metro cess.

The number of units registered in April 2022 was the best in a decade for the month, and monthly state revenue collections were at a 10-year high. Up to 55 percent of registrations were in the price band above Rs 1 crore while in terms of apartment size, mid-sized homes (in the range of 500-1,000 sq ft) were the most preferred category of property registered in April 2022, property consultancy Knight Franks said in an analysis.

This April’s sales registration of 11,744 units was the highest in a decade, followed by April 2021 when sales registrations were at 10,136 units. Both were preceded by record highs in their respective previous months, with March 2021 gaining traction as it marked the end of stamp duty waiver (3 percent stamp duty applicable rate) and March 2022 seeing higher sales as it was the last month before the introduction of the additional 1 percent metro cess, the Knight Frank study said.

86% of the properties registered in April 2022 were residential

Homes constituted the bulk of property registrations in April 2022, accounting for 86 percent of transactions. Commercial property deals contributed 8 percent while industrial property deals added 3 percent. The contribution of land deals was under 1 percent. Other forms of property deals made up the remaining 3 percent of properties registered in April 2022.

83% sales concentrated in up to 1000 sq ft housing segment 

Homes of 500-1,000 sq ft accounted for 47 percent of the total registrations in April 2022, followed by compact homes of up to 500 sq ft with a share of 36 percent. Homes of under 500 sq ft carpet area had previously received a government incentive of 100 percent relief in property tax effective February 2022, which is expected to further incentivise the affordable housing segment. Homes of 1,000-2,000 sq ft accounted for 15 percent of total registrations.

The focus remained on residential properties with a ticket size of Rs 1 crore and below, which made up 45 percent of residential property registrations in April 2022. Property sales of Rs 1 crore to Rs 2.5 crore had a contribution of 39 percent while those in the Rs 2.5–5 crore bracket had a contribution of 10 percent. Residential properties above Rs 5 crore contributed to 5 percent of the total home sales in April 2022.

The western and central suburbs ruled the Mumbai market. The share of Central Mumbai and South Mumbai home sales went up 7 percent and 6 percent, respectively, in April 2022. Notably, sales in the western suburbs of the city went up to 62 percent from 51 percent in March 2022 over the previous year, while the central suburbs saw a drop in the share of property registrations from 38 percent to 25 percent in April 2022 over the same period, the data showed.

Buyers prefer buying property in their current micro-markets
In April 2022, Mumbai consumers demonstrated an inclination to purchase homes within their current location micro-market. Out-of-city buyers showed interest in purchasing residential properties primarily in the western suburbs

Buyers in the central and western suburbs showed a strong preference for properties in their own micro-market with 88 percent of those in the central suburbs and 86 percent in western suburbs opting for their current location while purchasing new property.

Being relatively affordable micro-markets within the city, 7 percent of consumers in the central suburbs purchased the property in the Western Suburbs, while 10 percent of those in the western suburbs bought the property in the central suburbs.

South and central Mumbai being premium micro-markets, 55 percent of buyers located there preferred their micro markets. Some 16 percent each of consumers based in South Mumbai preferred purchasing a home in central Mumbai and the western suburbs, respectively.

“It is heartening to see the continuous momentum of property sales, which has helped April 2022 register a decadal best performance for its corresponding months. The state government has continued to gain in terms of revenues. Even while outflows towards property purchase have increased due to metro cess, other factors like prices, home loan rates, household income and savings, and financial security have remained stable, encouraging buyers to conclude their purchases. We expect these sentiments to continue despite rising inflation and geopolitical challenges, as homeownership is considered a safety net against such challenges,” said Shishir Baijal, chairman and managing director, of Knight Frank India.

Moneycontrol News
first published: May 2, 2022 03:26 pm