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Rediff.com  » Business » 350,000 flats remain unsold in Mumbai

350,000 flats remain unsold in Mumbai

Last updated on: November 09, 2017 15:53 IST

The maximum inventories are in 1 and 2 BHK configurations totaling 587,500 units.

The Mumbai seafront. Photograph: Jayanta Shaw/Reuters

More than 3.5 lakh homes were unsold in the Mumbai metropolitan region out of the total 6.7 lakh under-construction flats registered with the State real estate regulator till August, according to Cushman & Wakefield and Propstack.

Global property consultant Cushman & Wakefield and real estate data analytics firm Propstack have analysed the Mumbai Metropolitan Area projects registered with the Maharashtra Real Estate Regulatory Authority (MahaRERA) till August.

 

According to the report, as many as 670,339 units were registered under MahaRERA, of which 52 per cent (350,713 units) were unsold and 48 per cent (319,626 units) were sold.

The maximum inventories are in 1 and 2 BHK configurations totaling 587,500 units.

In sales, configurations of one and two bedrooms were the most sold and contributed over 85 per cent of total sales.

'With over 50 per cent of the current residential inventory remaining unsold, the prices of projects have been largely stable even as the momentum in launches of new projects has been slow in the MMR region,' the report said.

The buyers prefer smaller flats due to high real estate prices in the MMR region.

Even while the capital values of affordable homes across most micro markets have not seen any drastic changes, the report said that rates are higher by 10 to 15 per cent when compared to other cities like Bengaluru, Delhi NCR and Pune for comparable projects and locations.

"Maharashtra's early adoption of RERA (the Real Estate Regulatory Act) will ensure that more projects get the requisite funding for completion of projects from domestic and international funds," said Gautam Saraf, MD (Mumbai), C&W.

He expected that the end-user purchase activities would start picking up in the next few months as RERA gives buyers a safety net for their investment.

"Thus, with improving sales momentum and better project management processes in place, we expect investors to show greater confidence towards the sector and increase their fund allocation to residential real estate," Saraf said.

According to the report, 43 per cent of all registered projects are expected to be completed on schedule, delays beyond three years are less than 15 per cent.

'Traditionally, delays in projects from their committed timelines had become commonplace and buyers faced huge uncertainty on final delivery. However, with the MahaRERA norms coming in, a developer is now liable to make on-time delivery with a maximum provision of only 12 months delays,' the report said.

PropStack India Director Sandeep Reddy said the market, including end-users, will have better access to information on developers and projects as more and more projects register for MahaRERA.

The data would help create better, sharper analysis of demand as well as design future supply to help avoid demand -- supply mismatches, he added.

IMAGE: The Mumbai seafront. Photograph: Jayanta Shaw/Reuters

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