Mumbai real estate hits 11-year transaction peak, contributes Rs 697 crore to state revenue

Mumbai's real estate sector witnessed an upswing in November, recording the highest number of property transactions in the past 11 years. According to a report by Knight Frank India, the city registered 9,548 properties, contributing Rs 697 crore to the state government revenues.

Despite a shortened working month due to holidays, Mumbai's property market displayed resilience with a 7 per cent year-on-year rise in registrations and a 2 per cent increase in stamp duty collections compared to the previous year. Residential units constituted 80 per cent of the registered properties, while the remaining 20 per cent comprised non-residential assets.

Suburban dominance

Central and Western suburbs emerged as the focal points, accounting for over 75 per cent of the total registrations. These areas, known for new launches with modern amenities and excellent connectivity, attracted buyers seeking convenience and lifestyle. Notably, 86 per cent of Western suburb buyers and 85 per cent of Central suburb purchasers chose to stay within their micro markets.

For the first eleven months of 2023, Mumbai achieved a registration count of 114,464 units, contributing Rs 9,922 crore to the state treasury.The surge in property registrations can be attributed to factors such as the registration of higher-value properties and an augmented stamp duty rate.

Price surge predicted

Shishir Baijal, Chairman & Managing Director, Knight Frank India, noted, "Following a 6.5 per cent YoY increase in prime property prices during Q3 2023, Mumbai is anticipated to witness a 5.5 per cent upsurge in prime residential prices in 2024." Baijal highlighted the rising share of high-value property registrations, noting an increase from 51 per cent in YTD November 2020 to 57 per cent in YTD November 2023.

In recent years, there has been a consistent upward trend in the percentage of registrations for properties valued at Rs 1 crore or more. This proportion has risen from 51 per cent in January to November 2020 to approximately 57 per cent in January to November 2023. Despite a notable increase in property prices and a 250 basis point rise in the policy repo rate in the last two years, registrations for properties valued at Rs 1 crore and above have shown limited impact, underscoring the resilience of the high-end property segment in Mumbai's real estate market.