The Stamp duty reduction and a continuing price correction has resulted in a sharp bounce back in September housing sales in Mumbai, the country’s most expensive property market, as indicated by the registration activity during the month.
Registration of sales agreements stood at 5,597 in September, nearly 95% of pre-Covid level seen in February.
The registration numbers rose 110% from July, reflected data from the office of the Inspector General of Registration Maharashtra.
In August, the government of Maharashtra had announced reduction in stamp duty on property registrations to 2% for transactions between September 1 and December 31 from 5% earlier.
The stamp duty will be 3% for agreements to be registered between January 1 and March end.
“Even though stamp duty was reduced, the momentum of registration had not picked up until the end of Pitru Paksha, which is considered to be inauspicious. However, the pace of deal registration increased rapidly after that,” Shridhar Dube-Patil, deputy inspector general of registration, Mumbai division, told ET.
However, the stamp duty collections during September remained lower at Rs 181 crore compared to Rs 438 crore in February due to a reduction in stamp duty.
Following the stamp duty reduction, realty developers who are part of National Real Estate Development Council (NAREDCO) in Maharashtra, had also announced absorbing the reduced stamp duty on behalf of prospective homebuyers until October end in bid to boost sales of residential real estate.
“The value of properties sold during the month has risen to almost the pre-Covid level of over Rs 9,000 crore based on the reduced stamp duty of 2%. Average ticket size of apartments sold stood at Rs 1.6 crore in the city,” said Sandeep Reddy, director of real estate data analytics firm Propstack.
According to realty developers the reduction in stamp duty charges coupled with the festive offers and other incentives has started to push sales activity.
“With low home loan rates, stamp duty reduction and the onset of the festive season, it is safe to say that it’s the best time to invest in Real Estate, especially in the Mumbai Metropolitan Region (MMR) Region. Hence, it is of no surprise that home sales registrations have increased, providing more definite evidence of improving homebuyers’ sentiments and gradual revival of the sector,” said Deepak Goradia, President of realty developers’ body CREDAI MCHI.
Realty developers also attributed the rise in sales activity to customers visiting the sites again leading to better conversions.
