The Mumbai city (BMC area) recorded property sale registrations of 9,523 units in May 2022, up a 78 per cent year-on-year, contributing over ₹709 crore to the state revenues, a 164 per cent rise, according to a report by Knight Frank India.
The number of property units registered in May 2022 was the best compared to the corresponding months in a decade. In May 2021, property sale registrations totalled 5,360 units.
“The substantial rise comes on the back of low sales registrations recorded in May 2021 as the month was laced in lockdown due the impact of second wave of Covid -19,” the report said.
However, as compared to April, May recorded a 19 per cent M-o-M (Month on Month) drop in property registrations. The property registrations totalled 11,743 units in April 2022.
As per the report, the dip in MoM registrations can be explained by the advance purchasing until the deadline of March 31, 2022, when homebuyers could potentially save 1 per cent metro cess cost.
About 37 per cent of the property registrations executed in May 2022 were filed in March 2022 at effective stamp duty rate of 5 per cent. While 2 per cent of all properties registered in May 2022 were filled in April 2022. The remaining 60 per cent were filled in May 2022 having an effective stamp duty rate of 6 per cent.
“With the rush behind us, the registration momentum now has returned to regular market activity that is devoid of such externalities,” it said.
Shishir Baijal, Chairman & Managing Director, Knight Frank India said, “The real estate market in Mumbai held steady despite the pressures of inflation, rising input costs and rise in stamp duty.”
“Owing to a paradigm shift in attitude, home buyers, that now consider ownership important for long term stability, were keen on completing their purchases while the affordability remained within the acceptable range. Going forward, while mounting economic pressures will play their part, other factors like rise in household savings and mid to long term financial stability as well as strong economic outlook, will help continue the home buying momentum,” Baijal added.
State government revenues
The monthly state revenue collections were at a 10-year high in May 2022. The Government revenue collection in May recorded a growth of 164 per cent YoY, up from ₹269 crore in May 2021, with an average daily sale rate of 307 units. However, on month-over-month comparison, revenue was down from ₹738 crore in April 2022.
Residential deals a majority
In May, 85 per cent of the property registrations were for residential deals while the commercial property accounted for 10 per cent of the total deals registered in the month. Industrial property deals contributed 2 per cent while land deals registered were under 1 per cent. Other forms of property deals contributed to 4 per cent of the total deals registered in May 2022.
On apartment size, homes of 500-1,000 sq ft continued to be the top preference, accounting for 48 per cent of the total registrations in May as compared to 47 per cent in April . The compact home of up to 500 sq ft accounted for 34 per cent of all properties registered while the share of homes of 1,000-2,000 sq ft remained unchanged at 15 per cent of total registrations in May.
A majority of deals were ₹1 crore and above as 54 per cent registrations were in this price band.
The residential properties accounted for 46 per cent of the registrations in May with a ticket size of ₹1 crore. The residential properrties of ₹1 crore to ₹2.5 crore contributed 39 per cent while ₹2.5–₹5 crore contributed 10 per cent. Residential properties above ₹5 crore contributed to 5 per cent of the total residential deals in May 2022.
Decline in share of western suburbs
The share of western suburbs has declined from 62 per cent in April 2022 to 51 per cent in May 2022 while Central Suburbs recorded a rise in share of contribution as compared to April 2022, increasing from 25 per cent in April 2022 to 36 per cent in May 2022. Central Mumbai also saw an increase in share contribution to 8 per cent while South Mumbai recorded a drop to 5 per cent.
Maximum share of property registrations with ticket sizes of ₹5 crore and below has been recorded in the Western suburb micro market. For high value ticket sizes of ₹5 crore to ₹20 crore, luxury micro market such as Central Mumbai recorded largest share contribution, as per the report.
“In May 2022, the consumers within Mumbai continued to demonstrate low inclination towards relocation to a different micro market. Out of City buyers have shown interest in purchasing residential properties primarily in Western Suburbs followed by Central suburbs,” the report said.
“Central and western suburbs being relatively affordable markets, buyers in these micro markets have shown a tendency to upgrade to properties within their own micro market,” it added.
Ninety-two per cent of homebuyers from central suburbs and 81 per cent from western suburbs prefered their current location while purchasing new property. Around 15 per cent of home buyers from western suburb have relocated to central suburbs.
Homebuyers from the prime micro markets such as central and south Mumbai have an inclination towards property purchase within the micro market, as per the report.
About 55 per cent of home buyers from central Mumbai and 50 per cent from South Mumbai have purchased in the same micro market. However, a 55 per cent of homebuyers in central Mumbai and 50 per cent from south Mumbai, prefered purchasing a property within their micro market
Central suburbs emerged as the second preferred market for homebuyers of central and south Mumbai with a share contribution of 26 per cent and 20 per cent, respectively
On age-wise distribution, the largest share of home buyers (44 per cent) in May 2022 fell in the 31-45 years age bracket. 46-60 years category had a share of 34 per cent while 10 per cent were under 30., and 12 per cent were over 60.