Real-estate sale volumes in Mumbai, one of the strongest residential market in the country, have plummeted more than 70% since its 2007 heydays, says a recent report by global property consultant Knight Frank.
A drop in transaction volumes has hit the Central Mumbai market the hardest as the quantum of unsold inventory makes up over 40% of the units launched in this micro-market.
The Mumbai real estate market has stagnated over the previous three quarters, with buyers largely keeping away from the market with the expectation of an imminent drop in prices in the near future, states the report.
The Maharashtra State stamp and registration department data has shown a consistent decline in the number of property sales registrations over the previous year. Total property registrations have declined 20% for the six month period ending June 2011, compared to the corresponding period last year.
The report states that in the present market conditions developers have been more open to negotiation in the premium segment, reducing prices by as much as 20% in favour of a sizeable up-front payment.
Tight liquidity conditions, increasing inventories, rising interest rates, and construction costs should eventually tip the scales in the buyers’ favour, the report adds.
Source: The Economic Times