Property registrations in Mumbai exceeded 10,000 units for the third consecutive month in August, driven by strong demand, especially in the premium segment. This is despite challenges such as rising property prices and higher mortgage rates.
The revenue collected by the government this month was INR 776 Crore, a 7 per cent decline from July 2023, but a 21 per cent increase from August 2022.
A quick assessment of new unit launches in Mumbai for the period of Apr-Jun 2023 indicates that properties ranging from 500 - 1,000 sq ft dominated with the highest share of 51 per cent. However, this has declined from 61 per cent in Apr-Jun 2022.
Anuj Puri, Chairman – Anarock Group, says, “Properties sized less than 500 sq ft, accounted for an additional 35 per cent of total launches in Apr-Jun 2023, a significant rise from 27 per cent in Apr-Jun 2022. This trend indicates that with the rise in property prices, homebuyers are now again looking for smaller units to manage their overall budget.”
“Analysing the new unit launches in Mumbai for the period of Apr-Jun 2023, it was evident that the INR 80 lakh – INR 1.5 Cr segment saw the highest activity, constituting 43 per cent of the total launches. This segment’s share has increased rapidly from 36 per cent in Apr-Jun 2022.”
The INR 1.5 Cr – INR 2.5 Cr segment accounted for 27 per cent of the total new launches in Apr-Jun 2023, declining from 35 per cent in the first quarter of 2023. Contrary to the above, properties priced above INR 2.5 Cr accounted for 21 per cent of the total new launches in Apr-Jun 2023, indicating a noteworthy share and rise from 16 per cent in the Apr-Jun 2022 quarter.
The above trends indicate that homebuying activity in Mumbai is skewed towards the high-end and ultra-luxury segment. The high-end segment probably comprises homebuyers looking to upgrade or are pushed here due to a rise in property prices. The ultra-luxury segment includes HNIs and UHNIs looking to close favourable deals by utilizing the gains made through other investment avenues, primarily the booming stock markets.
A regional analysis of Mumbai's new launches in Apr-Jun 2023 shows that the highest number was recorded in the Western Suburbs (55 per cent), a significant increase from the 32 per cent share in the Apr-Jun 2022 quarter. The operationalization of the second phase of two metro lines seems to have benefited the real estate activity in this region.
The share of Eastern Suburbs has declined to 38 per cent in Apr-Jun 2023, from 61 per cent in Apr-Jun 2022. This can be attributed to the delay in metro rail completion, restarting of a few delayed real estate projects, and large-scale launches during the past few years.
While Mumbai’s property purchase trends are changing, the good news is that it retains its overall positivity. The third consecutive month of 10,000+ property registrations was unaffected by the peak of the rainy season. The onset of the festive season is likely to further boost the homebuyer sentiments and the next few months may witness a heightened property registration activity.