Registrations in the first 3 months of 2021 have almost reached the halfway mark of full-year 2019 and 2020, according to the report
The financial capital of India, Mumbai recorded a surge in property registrations driven by home sales in the last month of the lower stamp duty window.
Registration of residential properties in Mumbai jumped over four-fold in March to 12,696 units as compared with March last year on account stamp duty cut by the Maharashtra government, according to Knight Frank India.
The sales particularly peaked in the last few days of the month with daily rate of new registrations increasing to 707 units between March 15 – 24, 2020. At the current pace, the month of March 2021 can witness sales upwards of 17,000 units.
The sales in March 2021 grew 234% YoY over the same month last year, registering the highest YoY growth in the months after the stamp duty cut. While March 2020 noted registrations of 3,798 units, March 2021 saw 12,696 units being registered.
“Mumbai recorded a historic surge in home sales registrations in the month of March 2021,” Knight Frank said in a statement. The euphoria amongst homebuyers has grown stronger despite the 1 percentage point or 100 bps increase in stamp duty rates effective from 1 January 2021 it further said.
Knight Frank India Chairman and Managing Director Shishir Baijal said,“The reduction in stamp duty rate has helped mitigate the pain in the long-beleaguered real estate sector of Mumbai. As expected, with the revival of the economy, the sales momentum grew stronger in Q1 2021 and the euphoria amongst homebuyers continued despite the 100-bps increase in stamp duty rates. A combination of lowest home loan rates, reduced house prices along with rebates and payment flexibility offered by developers, as well as increased household saving rates, have provided the right growth environment for the residential segment to grow.”
Shishir further added, “After several years of anguish, the real estate sector in Mumbai is making an attempt to stand on its feet. However, the rising number of cases in the country and the resultant lockdowns in some cities, is threatening to jeopardise this arduous recovery path charted by the sector. It would be immensely helpful if the Government extends the window of stamp duty reduction by few more months till the sector can find its feet and start sprinting again.”
Between September 1 and December 30, 2020, Mumbai recorded registration of 41,681 units with numbers growing incrementally month-on-month.
From 1 March 2021 to 24 March 2021 Mumbai recorded property registration of 12,696 units at a daily rate of 529 units which is nearly 4.3 times higher than the daily rate of registration recorded at 123 units in March 2020.
The sales particularly peaked in the last few days of the month with daily rate of new registrations increasing to 707 units between March 15 – 24, 2020. At the current pace, the month of March 2021 can witness sales upwards of 17,000 units. In December 2020 – the closing month for the first phase of reduced stamp duty, there was a stupendous increase in registrations in the last few days of the month as homebuyers rushed to make the most of the lower stamp duty window of 2%.
From December 1, 2020 to December 25, 2020 the daily average of number of units getting registered in the month of December 2020 was at 585 units. This daily average of registrations nearly doubled at 1019 units in the last week between December 27 – 30, 2020. We expect similar trend to play out in March 2021 as well.
From 1st September 2020 till date, the total revenue from apartments sales realized by the city exchequer has been over ₹2,578 crores. When compared to the period before the stamp duty cut, i.e January 2020 to August 2020 the Government had collected Rs1,756 Crores. This can be seen as a clear indication of the strong impact the stamp duty registrations have had on the revenues.
The reduction in stamp duty has created beeline for purchase of homes outside registration offices with Mumbai witnessing historically strong sales. Homes sales have continuously risen month on month in each window. Between the period from September 01 2020 – March 24 2021, Mumbai recorded registration of 75,688 units with numbers growing incrementally month on month in both windows, the report said.