REALTY PRICES IN MUMBAI DROP BY 1112% FOR FIRST TIME SINCE 2010

MUMBAI: Faced with a realty slowdown and depleting sales, builders have, for the first time since 2010, reduced real estate prices by an average 11-12 % in Mumbai Metropolitan Region (MMR).

This includes both a reduction in base price as well as sops and incentives like waiver of stamp duty and no floor rise charges.

This is also the first time that approximately 80% of builders are indulging in rate cuts to woo homebuyers.

The report, published by Knight Frank India, a real estate consultancy firm, said it is a buyers’ market. “The builders are desperate to offload their existing stock and hence are giving discounts and other sops to attract the buyers,” said Samantak Das, chief economist and national director, Knight Frank India.

He said in some cases, builders have even given discounts up to 25 % after negotiations with buyers. Some of the schemes in the market are waiver of stamp duty and registration fees, no floor rises, 24-month rent assurance as well as gift items.

Currently, builders are saddled with a huge inventory of unsold apartments running into more than 2.67 lakh in MMR, which includes 1 lakh home units in Mumbai alone.

Builders say discounts have become the norm of the day.

“There is a huge supply and we need to sell them and hence are offering rate cuts,” said Ashok Mohanani, chairman and managing director, Ekta World. Rajesh Vardhan, director, Vardhman Developers, said discounts tend to increase sales. “They bring momentum in sales as we need money to execute our projects.”

Buyers, however, are still playing the waiting game and exploring options. “I feel the prices will come down further and since I have waited until now, I will wait a little more,” said Ashish Jaiswal, a bank executive.

The real estate industry, in the past few years, has been going through a tough phase. Builders jacked prices to exorbitant levels, forcing many homebuyers to postpone their purchase plans.