Mumbai realty registrations recover in Dec after Nov slump

Written by Shubhra Tandon | Mumbai | Updated: Jan 29 2014, 10:32am hrs
After hitting a five-year low level in November, Mumbai's property sales registration numbers rebounded in December 2013, showing a renewed interest in the financial capital's property market from buyers.

The December 2013 numbers were the highest reported compared with the same period for the last three years. Registration numbers surged a sharp 80% on a month-on-month basis to 6,916 in December, and 11.7% year-on-year, data sourced from Director General of Registrations, Mumbai show. In November 2013, the numbers plunged to 3,842, data showed. Traditionally, the December registration numbers are higher, as customers rush to register their properties before the ready reckoner (RR) rates are revised on January 1 every year. However, in 2013, aggressive pricing by realty developers, and more new launches aided higher sales, say industry consultants.

December registration numbers are a reflection of good sales momentum seen in Mumbai property market during September to November. Many new projects were launched at aggressive prices, which were received well by customers," says Mudassir Zaidi, national director (residential), Knight Frank India.

In Mumbai, buyers are required to register their properties on payment of 20% of the transaction value. It usually takes customers 2-3 months to make the payment, so deals transacted in the September-November period reflects only in the registration numbers of December, say consultants.

The prices in newly launched projects have been 25%-30% lower than the ready available stock in the market, says Zaidi. Generally, pricing in new projects come at around 20% discount to the projects which have ready possession flats. However, that discounting factor has gone up to about 25%-30% depending on the project and location."

According to sources, Mumbai-based Lodha Developers offered a pricing of Rs 22,000-23,000 per square feet for its Park project in Lower Parel, located in central Mumbai, at a time when some projects with ready-for-possession flats commanded upwards of Rs 30,000 per sq ft. For its other project called New Cuffe Parade in Wadala, the company was offering prices at around Rs 15,000 per sq ft, while ready apartments were priced at around Rs 20,000 per sq ft.

In Andheri too, some newly launched projects were available for between Rs 17,000 to Rs 18,000 per sq ft, while ready apartments commanded upwards of Rs 20,000 per sq ft, say sources.

Apart from pricing, the customers also had more choice as number of new project launches went up. There were 34 project launches in the last quarter of 2013 calendar year, says Om Ahuja, CEO (residential services), Jones Lang LaSalle India. There was a lull in the period before the festive season, however, Dussehra and the period after that came in as a good surprise and the momentum continues. With about 60-odd launches planned in next three months, markets should be looking good, says Ahuja.

Some of the developers who launched projects include Kalpataru, Raheja, Tata, Lodha and Wadhwa.

Positive sentiment resonates amongst developers too, who say rupee depreciation has aided in closing a lot of transactions with non-resident Indians (NRIs). We launched four projects in the last three months of 2013 and the response has been good. Around Rs 150 crore of sales has been clocked from stock sold to NRI community, says Srinivasan Gopalan, COO and CFO, Wadhwa Group. He said, the velocity of sales has gone up as he has seen in the recently launched projects.

In W54 Dadar, where apartments cost Rs 12-14 crore, we closed seven deals against our target of three in the last quarter. Solitaire and Platina in Thane and Evergreen Heights in Kalwa, priced between Rs 70 lakh and Rs 1.5 crore, we sold 45 units in last quarter. In Chembur, we did a pre-launch only for the international market and saw one lakh sq ft of sales" he said.