House in Mumbai

After a one-year period starting in the third quarter of 2009, which saw a strong recovery with a record 40%-plus increase in prices, the Mumbai residential real estate market has been seeing a slowdown over the past two quarters across various micro markets. The past six months have seen the return of negotiability in asking prices, and saw the return from a sellers’ to a buyers’ market . Both registration data and home loan disbursals are indicating a distinct slowdown. The number of apartments being sold in the first quarter of 2011 is considerably lower than in the corresponding period of 2010.

Developers who were selling their entire projects in a few weeks are now taking months to sell their unsold stock. Many home buyers are playing the waiting game, anticipating a further correction. The key reasons behind this slowdown are higher prices, higher interest rates impacting affordability, lack of liquidity, scams diluting investor sentiment – and, to a lesser extent, excess supply in a few micro markets. Any slowdown in the economy has not been a key criterion. Many developers and agents admit that sales have slowed down. Gone are the days when large numbers of apartments were sold during the launch itself . The trend of short termspeculators booking apartments at pre-launch or launch prices and selling them a few months later at higher prices (as witnessed in early 2010) has reduced considerably. Some of the other trends witnessed over the past six months include developers offering significantly lower rates to customers willing to cough up a 30-40 % down payment.

More News: economictimes

A decade ago, most people may have viewed towns like Panvel and Pen as the boondocks, but today, satellite cities are having the last laugh. In the Mumbai Metropolitan Region (MMR) towns like Kharghar, Thane, Badlapur, Belapur, Panvel, Kharghar and Kalyan-Dombivli, to name a few have registered a huge growth in population over a 10-year period. On the other hand, the island city’s population is down by 5%, while Mumbai’s suburban population has increased by only 8%.

Data collected for the 2011 census drive shows that Kharghar tops the growth list -between 2001 and 2011, the town’s population has increased from a mere 6,000 to 73,000. That’s a 1,117% jump. Other top performers are Vasai-Virar, which has recorded a rise of 221%, followed by New Panvel (113%). The overall increase in population in MMR, with the exception of Mumbai, is 54% (see map).

The main reason for this growth, say experts, is the rise and rise of Mumbai’s real estate, which has prompted people to look beyond the city for affordable housing. Demographers and social scientists also attribute this trend to a combination of factors including the release of Sixth Pay Commission funds and nominal real estate prices in these regions. According to civic officials and town planners this is a positive trend. R Parasuraman, director of Tata Institute of Social Sciences (TISS) said this shift has decongested Mumbai city. New industries and white-collar jobs are attracting people to satellite towns,

More News: timesofindia

The real estate market in Mumbai continues to remain stagnant as sale transactions are at an all-time low due to the high property prices. Traditionally, property sales in the city go up between February and April, with March recording the highest number of transactions. But, this year even that does
not seem to be happening.

As per a research conducted by Prabhudas Lilladher, a financial services provider, home registrations in February have come down to 4,716 from 5,735 in the same month last year.

“People are waiting for prices to come down and hence are deferring purchase,” said Kejal Mehta, an analyst with Prabhudas Lilladher.

On Gudi Padwa, the Hindu New Year, property sales usually peak as it is regarded the most auspicious period to buy property. Analysts, however, discount any such possibility this year.

The prices are so high that people cannot afford to buy even if they want to,” said Pankaj Kapoor, CEO, Liases Foras, a real estate research firm.

Builders, however, continue to put a brave front. “Prices have risen, but so have the salaries,” said Sunil Mantri, chairman, Maharashtra Chambers of Housing Industry (MCHI). But, Mantri is quick to add that some correction may be expected in a few areas in the city.

More News: hindustantimes

It’s been a weak start to the year for the Mumbai real estate market with the number of property sales registered in India’s financial capital continuing to fall for the second consecutive month. The downtrend in sales volumes for the month of February is similar to that seen in January. Sales registrations at 4,716 are down 22% year-on-year and 7% month-on-month, according to a study by Prabhudas Lilladher, which points out that even after adjusting for the fewer days in February, the numbers would be more or less similar to those seen last month.

“The three-month moving average graph for sales registrations clearly illustrates a continuation of the downtrend,” the brokerage notes, adding that volumes for the lease segment continue to trend up, with the numbers coming in at 8,055, up 20% year-on-year. The continuous rise in the number of properties being leased is probably the result of prospective home buyers not being able to afford purchases after the sharp rise in property prices seen over the last one and a half years. It’s possible that prospective buyers are waiting for a correction.

Sales in Mumbai’s suburbs fell sharply, down 26% year-on-year in February, on the back of a 26% year-on-year drop in January. In contrast, sales in Mumbai city at 824 are up 13% year-on-year, albeit on the lower base of last year.

The brokerage notes that although February 2011 figures suggest a divergent trend, “a sharp slowdown is visible in both the city and suburbs, with volumes down 45% and 46% respectively compared to their peaks in 2010.”

Meanwhile, real estate analysts believe that although volumes were reasonably good at a pan-India level (ex-Mumbai), in the three months to December 2010, rising property prices and hardening mortgage rates combined with slowing investor demand will lead to volumes declining across most cities in the first half of 2011. “Volumes in Mumbai are down 50% below peak levels and we believe a similar trend ,though less acute, may play out in the National Capital Region (NCR) over the first half of calendar 2011

More News: financialexpress