Mumbai property revenue up 79%

February has seen the highest revenue collection in Mumbai in the last five years. Even in the entire FY23, the month recorded the maximum revenue collections.

Mumbai property revenue up 79%
February has seen the highest revenue collection in Mumbai in the last five years. Even in the entire FY23, the month recorded the maximum revenue collections. (File/Pixabay)

Luxury home sales have pushed up revenue collections 79% in Mumbai in February, compared to the same month last year. Mumbai, the country’s most expensive real estate market, saw revenue collections from property registrations touching a new high of `1,102 crore during the month.

“Interestingly, even while revenue collections went up significantly, the total number of property registrations in Mumbai saw a drop of 8% in the year — from 10,379 total registrations in February 2022 to nearly 9,511 registrations in February 2023. This clearly indicates that the sale of big-ticket price homes saw significant movement,” said Anuj Puri, chairman, Anarock group.

February has seen the highest revenue collection in Mumbai in the last five years. Even in the entire FY23, the month recorded the maximum revenue collections.

Knight Frank India, in a separate report, highlighted that daily average property registration in February was 331 units, the third-best for the month in the last 10 years after February 2022. The benefits of the stamp duty cut had resulted in the highest average daily sales of 363 units in February 2021, while February 2022 had seen average daily sales of 371 units due to a rush in property registrations prior to the metro cess being levied.

“In February, the average value of properties registered was `1.9 crore, which is 65% more than the average value of properties registered in February 2022 at `1.18 crore. Besides the rise in value, contribution from the metro cess has also added to the revenue. This has led to a decadal high revenue collection for the month of February at an average of `39 crore per day. This is an indicator of the buoyancy in the mid and high-end segment, which continues to show strength despite headwinds,” said Shishir Baijal, chairman and managing director, Knight Frank India.

One major reason for high sales of big-ticket price homes in Mumbai and other top cities in February could be the `10-crore cap on capital gains announced in the Union Budget. “This new move will come into effect from April. Thus, to save tax on capital gains, the HNIs across top cities including Mumbai are rushing in close luxury housing deals before the financial year ends in March,” said Anarock.

Under this, if one sells a house or other assets, including equities, and gains are more than `10 crore, then maximum benefit that can be availed is only up to `10 crore when invested into another property.

“Previously, to save on tax from their capital gains, HNIs/ultra-HNIs would mostly re-invest in an ultra-luxury property. Thus, the new move could be a deterrent for luxury housing sales to an extent once the new provision comes into effect. However, to say that it will have a major impact on this segment remains to be seen,” it said.

Meanwhile, luxury housing performed remarkably well across the country in 2022. Total sales share in the top seven cities went up to 18% of 365,000 units sold against just 7% of over 261,000 units sold back in 2019. In terms of overall sales share, MMR’s luxury housing sales share increased from 13% in 2019 to nearly 30% in 2022.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

First published on: 01-03-2023 at 04:00 IST
Exit mobile version