Mumbai: Three years ago, on the last day of the financial year, there were zero property registrations done owing to the nationwide lockdown. In the subsequent year, registrations in Mumbai shot up and have been on the decline since. At the end of this fiscal, the annual registration number too has decreased Year-on-Year by 21.37%, but the revenue collection has been at its highest with a 41.65% rise on account of the metro cess levy.
In March 2023, there was a shift in property buying pattern with lesser homes below ₹2.5 crore getting registered as compared to 87% the previous month when it accounted for 84%. The reason for the larger format and those above ₹2.5 crore apartments saw a spike in March was due to the budget announcement made by the Union government.
Direct impact on deals on luxury properties
Starting April 1, a cap will be in force with a limit of ₹10 crore to deduct long-term capital gain tax for reinvestment in residential properties. This will have a direct impact on the deals about luxury properties, which have been in demand since the pandemic.
“In the new fiscal year, those interested in luxury properties and falling under the long-term capital gains tax bracket will pay in cash to circumvent the latest rule. There might be some lull in April, but the sales will pick up later. After all, several developers have a large pool of luxury housing inventory. They will not want to hold on to it forever,” said a real estate expert.
As per the data obtained from the Inspector General of Registration and Controller of Stamps, Maharashtra, this March there were 13,151 as compared to 3,798 registrations that happened in March 2020. The Covid-19-induced lockdown was in force from March 25, 2020, onwards.
Growth in numbers
Since the pandemic registration number has only swelled with March 2021 witnessing 17,728 property registrations which dipped by almost a thousand to 16,726 the subsequent March.
During FY2022-23, the state government earned ₹9,676.89 crore in stamp duty as compared to ₹6,831.34 the previous fiscal. This is a 41.65% increase in collection, primarily due to a 1% hike in stamp duty to recover funds under the ‘metro cess’ levy.
Founder and MD BetterServ Ventures Manoj Patwal said, “Given the current scenario of a steep rise in property prices owing to several factors such as the increase in interest rates, stamp duty and raw materials prices; we have already started witnessing short-term repercussions on the overall housing demand. Going forward, if the government takes appropriate measures, we believe that the sales momentum can continue for the coming quarters, and reputed developers with a good track record will continue to dominate the market.”
