Residential property sales have dipped by almost 70% in Greater Mumbai but prices are still stable, according to the latest analysis from DTZ. But in the suburbs there has been a 10 to 15% dip in prices. A slowdown is also starting in the commercial sector.
'A meltdown is gripping almost all the segments of the Indian realty market. Property rentals have started to cool down in Mumbai and Delhi,' said Amber Mahawheri, director investments at DTZ.
Property exhibitions mainly showcasing residential properties coming up in suburban Mumbai, Thane and Navi Mumbai have witnessed a large number of curious visitors but the bookings have been dismal, according to developers. Vikas Oberoi, Managing Director of Oberoi Constructions, confirmed: 'There is a slowdown in home sales.'
But he added that the demand for office space in the Mumbai market is still huge. 'Well-developed buildings still command a good premium. But there is a rationalisation happening in the rentals in select market which is good for industry.'
The slowdown has prompted developers to offer a range of freebies and concessions rather than reduce prices. 'Big developers have joined hands and decided not to scale down the prices for another six months. These are developers with deep pockets. Small builder don't have this luxury,' said a member of Maharashtra Chamber of Housing Industry.
Freebies and concessions being offered include the developers themselves bearing the stamp duty and registration cost and free parking. A few recent interventions made by the state government are also expected to have a softening effect on the prices.
The state has granted additional floor space index, i.e. more space for construction in the suburbs. This is expected to give a boost to old housing societies which could go in for redevelopment.
