MUMBAI: New launches in the Mumbai residential market increased by 33%, from 4,616 units in Q1CY21 to 6,143 units in Q2CY21, according to a study by real estate consulting firm JLL.
While sales in the city remained at similar levels of Q1CY21, transactions were concentrated in the price segment of ₹50 lakh to ₹1 crore, which accounted for 40% of the sales during the quarter.
Eastern suburbs accounted for the majority of new launches, with 25%, followed by Western suburbs II (comprising of Malad, Kandivali, Borivali, and Dahisar) with 22%.
In terms of sales, Thane and Navi Mumbai combined reported close to 50% of sales. When compared with Q1CY21 capital value of residential units in the city remained stable in Q2CY21.
Most new launches in Mumbai were in the affordable and mid-segment (ticket size up to ₹2 crores) and formed 84% of the launches during the quarter. In sync with demand, developers are expected to focus on these price segments.
Karan Singh Sodi, regional managing director, JLL India said, “The increase in sales presents clear signs of demand and buyer confidence coming back to the market. This has been on the back of historically low home loan interest rates, stagnant residential prices, lucrative payment plans and freebies from developers, and government incentives such as the reduction of stamp duty.”
Mumbai has consistently been the largest contributor to sales over the past five quarters and the trend continued in Q2CY21. Almost one-third of the sales volume was contributed by the city during the quarter.
Residential sales across the top seven cities in Q2CY21 increased by 83% as compared with Q2CY20, across the top seven cities. According to JLL’s Residential Market Update, Q2CY21 released recently, this was mainly due to low base effect, less stringent lockdowns, and accelerating vaccination drives during Q2CY21, demonstrating improved resilience in the market.
During the first wave of covid-19, residential sales dropped by a record 61% quarter-on-quarter to 10,753 units in Q2CY20. However, the impact of the second wave has been limited with sales in Q2CY21 dipping by 23% to 19,635 units.
“The residential sector displayed improved resilience in Q2CY21 when compared to Q2CY20. There is no denying the fact that the second covid-19 wave dented the market following a good recovery curve. However, the impact was muted when compared with the same period last year,” said Dr. Samantak Das, chief economist, and head research and REIS, India, JLL, adding that most of the changes observed in the sector have been structural in nature and demand for homes is only expected to increase.
“The RBI is expected to hold policy rates at the existing historically low levels, while prices will remain mostly range-bound. The resultant affordable buoyancy will continue to attract fence-sitters and serious homebuyers,” he said.