Property registrations in Mumbai grew by about 8 percent to 14,149 in March from 13,151 a year earlier.
However, stamp duty collections from property registrations fell by 8 percent to Rs 1,126 crore last month from Rs 1,226 crore in March 2023, according to Maharashtra government data. Stamp duty collections declined for the second month in a row.
According to real estate consultancy firm Knight Frank India, the drop in February was due to extraordinarily high collections in FY23 following the government's decision to limit tax deductions on capital gains from the sale of residential property after March 31, 2023.
Residential units constituted 80 percent of the properties registered last month, according to Knight Frank India, which analysed the data. Houses and apartments spanning in size from 500 square feet to 1,000 sq. ft emerged as the favoured option of homebuyers.
Over 73 percent of the properties registered were in the central and western suburbs, which are the hotbed for new launches offering a wide range of modern amenities and good connectivity, according to the Knight Frank analysis.
Also read: Why Buy Now, Pay Later is making a comeback in the Mumbai real estate market?
According to the analysis, 86 percent of western suburb consumers and 92 percent of central suburb consumers opted for purchases within their micro-markets.
“The residential real estate sector in Mumbai has continued to perform exceptionally well in March 2024. The consistent increase in property sale registrations during March highlights the market's attractiveness among homebuyers," said Shishir Baijal, chairman of Knight Frank India.
Additionally, the Maharashtra government said on March 31 that it has decided to keep ready reckoner rates - also known as base rates - of each micro-market unchanged, a move that is expected to keep real estate prices in check. The government’s decision will help homebuyers in the affordable segment, real estate developers said.
"We appreciate the state government’s decision to not raise the ready reckoner rates in the state for 2024-25. This is a positive step taken by the government which will help improve market sentiments and boost the property market. This will be a great step to sustain the growth momentum," said Prashant Sharma, president of NAREDCO Maharashtra, the apex body of developers.
In FY24, the ready reckoner rates were not increased throughout the state. In FY23, the ready reckoner rates of all municipal corporations except Mumbai were increased by 8.8 percent from April 1, 2022.
What are ready reckoner rates?
Ready reckoner rates are the benchmark values of real estate. They are the basis of calculating capital gains for income tax, payment of stamp duty to the state government and are linked to all premiums and charges, and floor space index (FSI) rates payable to municipal corporations. The rates are released at the beginning of every financial year in Maharashtra.
The rates, also known as ‘circle rates’ or ‘guidance value’ in several parts of India, defines the minimum per sq. ft rate of a property set by the state government. One cannot sell property at less than the RR rate.
If property is sold at above the RR rate, then stamp duty paid by the buyer and other charges will be linked to the higher rate.
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