Lower stamp duty and cheaper housing finance seem to have played trick in revving up the demand for residential real estate in Mumbai. According to Knight Frank India report, housing sales in Mumbai in March 2021 increased 234 per cent over the same period last year. While March 2020 noted registrations of 3,798 units, March 2021 saw 12,696 units being registered, said the Knight Frank India report.
“As a direct result of the pandemic experience, home buying has improved. 2019 saw total sales of 67,863 units, whereas registrations in 2020 have come comfortably close to previous year’s level at 65,272 units,” the report said.
The value of apartments sold in January to March 24, 2021 period added to Rs 39,880 crore. Since the reduction of stamp duty rates from September 2021, apartments worth Rs 1,08,967 have been sold. Total value of all apartments sold in full year 2020 was estimated to be around Rs 1,00,245 crore surpassing the 2019 mark of Rs 90,769 crore, it said.
Shishir Baijal, Chairman & Managing Director, Knight Frank India said, “The reduction in stamp duty rate has helped mitigate the pain in the long-beleaguered real estate sector of Mumbai. As expected, with the revival of the economy, the sales momentum grew stronger in Q1 2021 and the euphoria amongst homebuyers continued despite the 100-bps increase in stamp duty rates.”
A combination of lowest home loan rates, reduced house prices along with rebates and payment flexibility offered by developers, as well as increased household saving rates, have provided the right growth environment for the residential segment to grow, he said.
According to Baijal, after several years of anguish, the real estate sector in Mumbai has made an attempt to stand on its feet. He also points out that the rising number of cases in the country (of Covid) and the resultant lockdowns in some cities, is threatening to jeopardise this arduous recovery path charted by the sector. He also wants the government to extend the window of stamp duty reduction by few more months till the sector can find its feet and start sprinting again.