3.5 lakh flats unsold in Mumbai metropolitan region

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New Delhi: More than 3.5 lakh homes were unsold in Mumbai metropolitan region out of the total 6.7 lakh under-construction flats registered with the state real estate regulator till August, according to Cushman & Wakefield and Propstack.

Global property consultant Cushman & Wakefield and real estate data analytics firm Propstack have analysed Mumbai Metropolitan Area (MMR) projects registered with Maharashtra Real Estate Regulatory Authority (MahaRERA) till August.

According to the report, as many as 6,70,339 units were registered under MahaRERA, of which 52 percent (3,50,713 units) were unsold and 48 percent (3,19,626 units) were sold.

The maximum inventories are in 1 and 2 BHK configurations totaling 5,87,500 units. In sales, configurations of one and two bedrooms were the most sold and contributed over 85 percent of total sales.

"With over 50 percent of the current residential inventory remaining unsold, the prices of projects have been largely stable even as the momentum in launches of new projects has been slow in MMR region," the report said.

The buyers prefer smaller flats due to high real estate prices in MMR region.

Even while the capital values of affordable homes across most micro markets have not seen any drastic changes, the report said that rates are higher by 10-15 percent when compared to other cities like Bengaluru, Delhi NCR and Pune for comparable projects and locations.

"Maharashtra's early adoption of Real Estate Regulatory Act (RERA) will ensure that more projects get the requisite funding for completion of projects from domestic and international funds," said Gautam Saraf, MD (Mumbai), C&W.

He expected that the end-user purchase activities would start picking up in the next few months as RERA gives buyers a safety net for their investment.

"Thus, with improving sales momentum and better project management processes in place, we expect investors to show greater confidence towards the sector and increase their fund allocation to residential real estate," Saraf said.

According to the report, 43 percent of all registered projects are expected to be completed on schedule, delays beyond three years are less than 15 percent.

"Traditionally, delays in projects from their committed timelines had become commonplace and buyers faced huge uncertainty on final delivery. However, with the MahaRERA norms coming in, a developer is now liable to make on-time delivery with a maximum provision of only 12 months delays," the report said.

PropStack India Director Sandeep Reddy said the market, including end-users, will have better access to information on developers and projects as more and more projects register for MahaRERA.

The data would help create better, sharper analysis of demand as well as design future supply to help avoid demand supply mismatches, he added.