Thanks to Mumbai's sky-high prices, 1.09 lakh apartments lying unsold
Mumbai, which rules the country's property market, has seen sluggish real estate trade recently. The city, still reeling from the effects of RERA (Real Estate Regulatory Authority), demonetization and GST, has about 1.09 lakh apartments lying unsold. Liases Foras, the research firm that compiled the data, said that the "singular reason for this state is unaffordability."
Pankaj Kapoor, CEO, Liases Foras, an independent realty research company, said that there are 2.60 lakh of unsold apartments in Mumbai Metropolitan Region (MMR), comprising Mumbai and its satellite towns. He blamed the government for levying 'heavy taxes and premiums on realty sector' though it 'talks of affordable housing'. "The entire burden is ultimately borne by the buyer," pointed out Kapoor.
The maximum number of unsold apartments is in the Western suburbs - Andheri, Bandra, Borivli, Dahisar, Goregaon- at 49,462 units, followed by Central suburbs - Kurla, Vidyavihar - with 44,230 units. Island City has 15,945 unsold houses. The data included both ready and under-construction projects.
Though many builders did not agree with the numbers, they acknowledged that the market has been dull. "The real estate sector has undergone changes like RERA, demonetization and GST, which has led to a slowdown in the overall construction scenario," said Dharmesh Jain, Chairman, Nirmal Lifestyle. Nahar Group VC Manju Yagnik said there's hope for good sales since "buyers are now taking a plunge."
Due to real estate's recessionary phase since past few years, realty prices were at a high, forcing people to postpone their purchase plans. RBI's stringent lending norms, hike in home loan interest and possible economic slowdown were other dampeners in investment plans. However, both loan interest rates and apartment prices are now coming down.
Mumbai is the 16th costliest city globally, where you can buy a little less than 1,000 sq ft of land with Rs. 6.5 crore in sought-after areas. With this amount, you can buy 21 kgs of gold or a luxury apartment.