1. Mumbai property prices plunge up to 40%, courtesy RERA

Mumbai property prices plunge up to 40%, courtesy RERA

Land auctions conducted by the City and Industrial Development Corporation in Navi Mumbai last week saw bids lower by as much as 40% compared with those in November.

By: | Mumbai | Updated: June 7, 2017 10:52 AM
RERA, RERA news, RERA latest news, RERA effect, RERA impact, RERA impact on mumbai housing, cidco, City and Industrial Development Corporation Manohar Shroff, vice-president, MCHI, Navi Mumbai, believes RERA is the primary reason for the bids having come in at such low levels.

Land auctions conducted by the City and Industrial Development Corporation (CIDCO) in Navi Mumbai last week saw bids lower by as much as 40% compared with those in November. Market watchers say land prices in several parts of the Mumbai Metropolitan Region (MMR) have started to trend down with the Real Estate (Regulation and Development) Act having limited developers’ ability to fund land purchases with advance payments from customers.

Compared with a price of around Rs 1.15-1.25 lakh per square metre back in November, prior to demonetisation, bids this time around ranged between Rs 65,250 and Rs 96,000 per sq m. Ashutosh Limaye, head of research at JLL India, told FE he expected activity levels in real estate would remain low for the next eight months.

CIDCO is selling six commercial plus residential plots in New Panvel, with plots covering an area of 6,000 sq m. The Neelsiddhi Group acquired three plots — two at Rs 65,250 per sq m and one plot at Rs 76,000 per sq m. The Millennium Group acquired one plot at Rs 80,000 per sq m, while two plots went to the Satyam Group at Rs 77,000 per sq m and Rs 96,000 per sq m.

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Manohar Shroff, vice-president, MCHI, Navi Mumbai, believes RERA is the primary reason for the bids having come in at such low levels. Demonetisation, per se, hasn’t really affected purchases of land and its value, he pointed out, since developers need to make payments to CIDCO via cheque.

“The builders’ ability to fund these land purchases has been curtailed thanks to RERA. The project plans need to be approved by the relevant authorities before the developers can accept bookings. And before the plans are submitted, CIDCO needs to be paid the full amount,” Shroff said.

Launches in the residential segment fell by about 8% in the year to March 2017, Cushman and Wakefield reported. The markets are off to a slow start with April and May seeing lukewarm sales, experts said. While some of this is due to the lingering effects of demonetisation, the markets are expected to remain dull for another six months due to the rigours of RERA.

In fact, near-term pain in the sector will be unavoidable, with no easy transition. K Ravichandran, group head, (corporate ratings), Icra, pointed out that since registration with RERA is now mandatory, any delay in setting up regulatory infrastructure could impact the operations of real estate developers, especially in case of new project launches.

  1. D
    Devendra
    Jun 7, 2017 at 2:15 pm
    Catchy headline even it is misleading ! This shows to what extent media can go down! Really horrible state
    Reply
    1. S
      Somashekar shekar
      Jun 7, 2017 at 10:54 am
      Paid public city by the print media
      Reply
      1. C
        ChemburStreets
        Jun 6, 2017 at 10:45 pm
        This is completely misleading. No reputed builder in Mumbai metro is wil to reduce the rates despite RERA effect. The ones that are doing are small and unscrupulous developers who want to get rid of their inventory and make quick buck from stale flats.
        Reply
        1. A
          A Singh
          Jun 6, 2017 at 9:26 pm
          This is good news for home buyers
          Reply
          1. P
            pmshah
            Jun 6, 2017 at 8:36 pm
            At these rates individuals can build their own bungalows and would cost less than buying a pigeon flat in a high rise. In Andheri flats are sold at Rs. 5 Lakh per square meter and that too super built up.
            Reply
            1. S
              Sivadasan Kesavan
              Jun 6, 2017 at 7:26 pm
              Generation of black money is restrained now thanks to the RERA. A transparent platform is to be established by an appropriate authority so that the /purchase deals of real estate ets (Both land and buildings) are performed in a transparent mode. Online monitoring by the regulator can be considered for transparency. Let the real estate agents be registered with the authority. When a property is put for the agents can publish it in the of the authority quoting minimum price expected. Interested parties can get in touch with the registered agent for negotiation. Or the interested parties may be advised to quote the price within a stipulated date. The land may be sold to the person who quotes the highest price. For the last few months number of deeds registered is lesser compared to previous periods, limiting the revenue from such deeds.
              Reply
              1. F
                Farooq Khan
                Jun 6, 2017 at 6:34 pm
                But there is nö buyer atleast previously there Had been buyer in market but now nö buyer with cheap ni country in world can survive with out Black money the only differ in India is that all Black money is With adani ambani ramdev and bhakats of this ppls who r political benefited With bjp Party this isthe time where ü say chor se kaho chori karoo Aur shah se kahoo jaagoo
                Reply
                1. M
                  Mandeep
                  Jun 6, 2017 at 7:20 pm
                  Man main sochne se ya kisike blogs padhnese, kisike paas Black Money nahin aa jaata. Don't talk nonsense without any factual data.
                  Reply
                  1. S
                    SHASHANK Mittal
                    Jun 6, 2017 at 11:18 pm
                    How can you expect sense. Just look at his name. No matter what, they will oppose BJP. If bad happens Modi is responsible and if good happens then it is due to Manmohan's policies whose benefits are getting reflected now. Even if a dog dies on street Modi is responsible.
                2. R
                  Rajiv Agarwal
                  Jun 6, 2017 at 6:22 pm
                  Why do you post wrong signals to public by saying 40 Mumbai Property market down Your artical is for new mumbai land deals so what's the big deal Show me one builder sel at 40 less actual mumbai market Some builders are sel at say Rs 65/79/89 lakes one BHK BUT HAVE YOU SEEN THE SIZE ITS its 340/360/390 carpet so you go in and I go out
                  Reply
                  1. S
                    Shrikant sahadev matere
                    Jun 6, 2017 at 12:57 pm
                    Yes
                    Reply
                    1. J
                      Jayant
                      Jun 6, 2017 at 12:45 pm
                      good show! It is time prices were rational and affordable.
                      Reply
                      1. A
                        Ashok Gupta
                        Jun 6, 2017 at 9:33 am
                        I strongly feel, due to RERA either no or at appreciated prices will happend bcoz most of the supply will be not be avbl for next 8-12 month.
                        Reply
                        1. S
                          Sachin
                          Jun 6, 2017 at 8:02 am
                          Incorrect headline by financial express. While the developers have bid at lower land price, the prices for apartments being sold in Mumbai have risen by 20-30 in the last one month to compensate for RERA expenses.
                          Reply
                          1. N
                            N A D
                            Jun 6, 2017 at 5:48 pm
                            That is exactly the opp of what we had hoped!
                            Reply
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