Mumbai Real Estate Slump: 3.5 lakh flats unsold in Mumbai metropolitan region, claims report

Mumbai: The claims of slowdown is the real estate sector in Mumbai Metropolitan Region (MMR) cannot be denied any more. This is now supported by figures that suggest that out of total units registered under MahaRERA, about 3, 50,000 units remain unsold. According to the latest report of Cushman & Wakefield and Propstack, about 52 per cent of units remain unsold up until August 31, 2017.

NAREDCO (west), vice president, Rajan Bandelkar said, “This percentage will go up further. The industry is in grave danger. Ready flats are getting sold as it does not come under the ambit of Goods and Services Tax (GST). It is the under construction flats that is suffering.” A total of number of under construction residential units registered under MahaRERA are estimated at 6, 70,339 across 5,620 projects, revealed the report.  The total sold units are estimated to be 3, 19,000.

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Bandelkar added that the GST council will have to make the second largest employment generation sector revenue neutral. He believes this is possible by 5 per cent tax slab. GST’s wrath is hurting tier I cities, he added. At present, the business can enjoy the input credit but customers cannot. This means that GST will have to be indirectly paid by the customer as builders don’t want to wait until the input credit comes.

Giving a different perspective to it, Sai Estate Consultants, director, Amit Wadhwani said, “There are about 55-60 per cent stock that is (under construction) sold but the figures are not out as most of the builders sell in phases.” Yet another reason for such a large number of unsold inventory is due to inflated prices and these rates are not sustainable, he added.

Wadhwani pointed that big developers and investors remain unaffected with this. “However, brands that lack in execution will be impacted,” he revealed. He stressed that customers in the end what homes to stay and not drag builders or developers to court for not executing the project in an efficient manner.

According to the report, 33 per cent of registered developments are beyond Thane, Western Suburbs have 25 per cent of total development. The report revealed the end-users’ are moving towards MMR region. Haware builders’ managing director, Aniket Haware  highlighted that the report fails to consider that some units are under-construction. Thus, the figures are high.  The products in the sector needs time to sell.  He said, “About 15-20 per cent growth in sales was seen in May-June-July.” He added the growth is there.