Consumer sentiment remains upbeat, over 11,700 properties registered for sale in April 2022: Knight Frank

Consumer sentiment remains upbeat, over 11,700 properties registered for sale in April 2022: Knight Frank

The number of units registered in April 2022 was the best in a decade

FPJ Web DeskUpdated: Monday, May 02, 2022, 12:14 PM IST
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Around 55 percent of registrations were in the price band of above 1 crore while in terms of apartment size, mid-sized homes (ranging between 500-1,000 sq ft) were the most preferred category of property registered in April 2022. /Representational image |

Knight Frank India, the leading real estate consultancy in the country, in its latest assessment noted that Mumbai city (MCGM area) saw property sale registrations of 11,744 units in April 2022, contributing over Rs 738 crores (Cr) to the state revenues.

The number of units registered in April 2022 was the best in a decade for the month of April, while monthly state revenue collections were at a 10-year high for the April month. Around 55 percent registrations were in the price band of above 1 crore while in terms of apartment size, mid-sized homes (ranging between 500-1,000 sq ft) were the most preferred category of property registered in April 2022.

Property registration momentum strong

April 2022 recorded property sale registration of 11,744 units making it the best April month in the decade, followed by April 2021 when sale registrations of 10,136 units took place. Both were preceded by record high March months, where March 2021 gained traction as it marked the end of stamp duty waiver (3 percent stamp duty applicable rate), while March 2022 saw higher sales as it was the last month before introduction of additional 1 percent metro cess.

Buyers advance purchase to save metro cess levy

Consumers advanced their purchase by filing in March 2022 while registering them in April 2022, effectively saving 1 percent metro cess on their deals. 82 percent of property registrations executed in April 2022 were filed in March- 2022 at effective stamp duty rate of 5 percent. While 17 percent of properties registered in April 2022 were filled in April 2022 having an effective stamp duty rate of 6 percent.

86% of properties registered in April 2022 are residential

Residential deals bag major share of property registrations in April 2022 with a contribution of 86 percent. Commercial property deals contribute to 8 percent while industrial property deals contribute 3 percent. Contribution of land deals is under 1 percent. Other forms of property deals contribute to remaining 3 percent of properties registered in April 2022.

Typology of property deals in April 2022

Typology of property deals in April 2022 | : Maharashtra Govt- Dept. of Registrations and Stamps (IGR); Knight Frank India Research

83% sales concentrated in up to 1,000 sq ft housing segment

Homes of 500-1,000 sq ft continued to be the preference, accounting for 47 percent of the total registrations in April 2022, followed by compact homes of up to 500 sq ft with a share of 36 percent. Under 500 sq ft carpet area homes had previously received a government incentive of 100 percent relief in property tax effective since February 2022, which is expected to further incentivize affordable housing segment. Homes of 1,000-2,000 sq ft accounted for 15 percent of total registrations.

Area-wise breakup of apartment sales

Area-wise breakup of apartment sales | Maharashtra Govt- Dept. of Registrations and Stamps (IGR); Knight Frank India Research

Focus on 1 cr and below deals with segment bagging a share of 45%

Focus remained residential properties with a ticket size of Rs 1 crore and below which made up 45 percent of residential registrations in April 2022. Rs 1 crore to 2.5 crore has a contribution of 39 percent while Rs 2.5 – 5 crore has a contribution of 10 percent. Residential properties above 5 crore contribute to 5 percent of the total residential deals in April 2022.

With 62% share, western suburbs continues to dominate housing sales in city

Western suburbs, followed by Central Suburbs, dictated the Mumbai market. The shares of Central Mumbai and South Mumbai have gone up to 7 percent and 6percent respectively in April 2022. The share of Western Suburbs has also risen to 62 percent from 51 percent in March 2022. Central Suburb saw a drop in share of property registrations from 38 percent to 25 percent in April 2022.

Buyers prefer buying property in their current micro markets

In April 2022, consumers within Mumbai demonstrated home purchasing inclination towards their current location micro market. Out-of-city buyers have shown interest in purchasing residential properties primarily in Western Suburbs

Consumers located in Central suburbs and Western suburbs show strong proclivity in buying property in their own micro market with 88 percent of Central Suburbs and 86 percentof Western Suburbs prefer their current location while purchasing new property. Being relatively affordable micro markets within the city, 7 percent of consumers located in Central Suburbs have purchased property in Western Suburbs, while 10 percent of consumers located in Western Suburbs have purchased property in Central Suburbs.

46% of home buyers in April 2022 are in 31-45 years age bracket

Largest share of home buyers in April 2022 are in the 31- 45 years category having contribution of 46 percent. 46-60 years category has a share of 31 percent in April 2022. 10 percent home buyers are under 30 while 13 percent are over 60.

South and Central Mumbai being premium micro market relatively lower, 55 percent consumers located in their micro markets prefer buying property within these micro markets. 18 percent consumers in Central Mumbai have shown inclination in buying property in Western Suburbs. While 16 percent of consumers based in South Mumbai preferred purchasing a home in central Mumbai and Western suburbs.

Highest revenue collection in April in last 10 years

Government revenue collection in April 2022 recorded at Rs 738 crore was a decadal best for April month surpassing April 2021’s collection of Rs 514 crore. April 2022 recorded a growth of 43 percent YoY over April 2021, when the effective stamp duty rate was 1 percent lower.

Expect these sentiments to continue: Shishir Baijal, CMD, KnightFrank India

Shishir Baijal, Chairman & Managing Director, Knight Frank India said “It is heartening to see the continuous momentum of property sales, which has helped April 2022 register a decadal best performance for its corresponding months. The state government has continued to gain in terms of revenues. Even while outflows towards property purchase have increased due to metro cess, other factors like prices, home loan rates, household income and savings, financial security etc. have remained stable, encouraging buyers to conclude their purchases. We expect these sentiments to continue despite cautions of rising inflation and geo-political challenges, as home ownership is considered a safety net against such challenges.”

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