The unsold inventory in the country’s costliest real estate market –Mumbai Metropolitan Region (MMR) – continues to remain high with over 2.2 lakh units remaining unsold as of September 2018.
The unsold inventory in the country’s costliest real estate market –Mumbai Metropolitan Region (MMR) – continues to remain high with over 2.2 lakh units remaining unsold as of September 2018. However, with fewer new launches and stable absorptions, the unsold unit numbers are holding steady post-2016.
MMR, which accounts for around 37% of the overall unsold units across the top 7 cities in India, has witnessed a growth of nearly 56% in unsold units till the end of September 2018 over 2013. The data show that the number of unsold units in 2013 in MMR stood at about 1.43 lakh units, which went up to nearly 2.3 lakh units in 2016, after which there has been a marginal decline.
“Aggressive launches between 2013 till 2015 have added to the unsold stock,” according to a report from ANAROCK Property Consultants. However, post 2015, with restricted launches and stable absorption rates the market has reversed its trend and the unsold stock has started to decline.
Majority of unsold stock in MMR is in Mumbai and its peripheral areas. Thane city and Navi Mumbai account for nearly one-third of the unsold stock in the region and the trend has been similar during the past five years. Lesser launches in Thane and Navi Mumbai, coupled with better off-take compared to Mumbai (due to higher affordability), have kept the unsold stock in these regions on the lower side.
As for the pricing, nearly 60% of the unsold stock in MMR is in the affordable and mid-segment of units priced less than Rs 80 lakh. Anuj Puri, chairman, ANAROCK Property Consultants, said: “While Mumbai’s share in overall launches in MMR declined from 71% in 2013 to 67% in the first three quarters of 2018, Navi Mumbai has witnessed an increase in share from 9-17%.”
A majority of the unsold stocks in MMR are still under various stages of construction. A handful of existing stocks are in the ready-to-move-in stage which the developers are looking to sell at a fast pace.
According to Samantak Das, head of research at JLL India, about 70-80% of the projects in the market are old projects, which would be getting completed in the next 7-8 months. “There is some amount of latent demand in the market and buyers are waiting for the projects to get occupation certificate so that it does not attract GST,” Das said.
GST is not chargeable on a ready-to-move apartment. He added that sales momentum is still choppy right now and it will take at least 2-3 more quarters for some stable growth to come back to the market.