The second wave of the COVID-19 pandemic is severer than the first wave. Even the lockdown duration, as well as the intensity, is similar. However, there is a stronger growth in property registrations in Mumbai post easing of lockdown restrictions compared to last year. In June 2021 as many as 7,857 housing units were registered which is a growth of 47 percent month-on-month (MoM) over May, data by Maharashtra government’s department of Registrations and Stamps (IGR) has said.
These numbers were up 327 percent year-on-year (YoY) compared to 1,839 units registered in June 2020. The registrations for June 2021 were also 39 percent higher compared to the same month in pre-pandemic period of June 2019, an analysis of the data by Knight Frank India has said.
Even though the duration of lockdown in Mumbai was similar to last year, the pick-up post gradual easing of restrictions was sharper this time around compared to last year, it noted.
It was noted that 42 percent of registrations in June 2021 were from new residential sales concluded in the month, recording a sharp improvement compared to 29 percent during May 2021 and 7 percent during April 2021. At 3,300 units, the number of new apartments sold (fresh sales) during June 2021 were more than double compared to 1,554 units sold in May 2021 and 348 percent higher compared to 710 units sold during April 2021, the analysis said.
The recovery indicates a fundamental shift in homebuyers’ behavior towards owning a house, an aspiration which had taken a backseat due to the ‘uberisation culture’ of recent years. This shift in behavior was complemented by other factors such as lowest ever home loan rates, discounts offered by developers, extended time spent indoors and demand for larger homes, to name a few. We are hopeful that this recovery will sustain, and the momentum will improve further keeping pace with improved vaccination and economic revival,” said Shishir Baijal, chairman and managing director, Knight Frank India.
The Maharashtra State Government, in December 2020, had given a leeway of four months to homebuyers to register a property after the payment of stamp duty in order to prevent crowding of registration offices. This ensured that homebuyers who had purchased residences and paid stamp duty on or before 31st March 2021, have a maximum window of four months till 31st July 2021 from the respective date of payment of stamp duty for registering their apartment.
efore this leeway was permitted, for over 95 percent of registrations in recent years, the difference between the date of payment of stamp duty and date of registration was less than 10 days and for less than 2 percent of the registrations, the difference was over 30 days.
Share of women homebuyers in new sales improves from 1.8 percent in May 2021 to 4.7 percent in June 2021
On March 8, to celebrate International Women’s Day, the Maharashtra Government announced a 1 percent rebate in stamp duty for women homebuyers effective from 1st April 2021. As a result of which women homebuyers constituted 6.6 percent of new home sales in the month of April 2021 paying a discounted stamp duty rate of 4 percent over their purchase.
The share of women homebuyers across the 5,360 units registered in May dropped to 1.7 percent. In June, the share of women homebuyers across the 7,857 units registered increased to 4.7 percent, the analysis said.
Homes worth Rs 1 crore and below witness traction
Upon assessment of sales and registration data since September 2020 – March 2021, it was observed that during the period of reduced stamp duty, new homes sales for that month in mid to premium categories, those costing Rs 1 crore and above, formed a significant part of registrations as lower stamp duty rate on high value housing led to substantial absolute monetary saving for the buyers.
The share of women homebuyers across the 5,360 units registered in May dropped to 1.7 percent.
However, since the withdrawal of the sop on stamp duty, the scale has tilted in favour of homes costing Rs 1 crore or below, with this category taking more than 60 percent of sales in the April-June 2021 period.
“This should be seen as a positive indication of the strength of demand from end users in this relatively affordable segment that continues to purchase despite no stamp duty relief. Going forward, as the vaccination programme gains momentum and normality returns, we expect sales momentum to gain pace led by demand from affordable and mid segment,” the analysis said.
