Price of home inventories dipped in Mumbai
The COVID-19 pandemic has led to an unsold inventory overhang in the Mumbai Metropolitan Region (MMR). It is one of the consequences of market slump during both waves of the pandemic. The areas under Mumbai Metropolitan Region are Mumbai, Thane, and Navi Mumbai.
A recent study for Quarter 2 of 2021 states that a total 15,968 real estate units sold across eight different markets in June quarter that displayed a 16% Year-on-Year decline. The same parameter has declined by 76% in this quarter compared to the similar timeline of the previous evaluation year.
Mumbai Metropolitan Region also saw a slump of 6% in the overall stock wherein 1.97 lakh housing sales were made in the second quarter of 2021. However, 2.10 lakhs units were sold in the second quarter of last year.
The inventory overhang in MMR for real estate companies and associates has dipped to 43 months in the second quarter of 2021. Whereas, the inventory overhang had shot up to 55 months last year during the first wave of pandemic.
This drop of 12 months overhang in the real estate sale in Mumbai Metropolitan Region was seen as the biggest slump in the top seven cities. This drop is also being compared to the likes of 2015 when the overhang dipped to 42 months.
As the market dip was observed, the central and state governments also halved the duties levied on various real estate transactions in the states as a consequence of the pandemic. While it helped shoot up housing sales in the first quarter of 2021, only 5% of the population living in the MMR area could actually afford the heavy transactions.
The market price has doubled over two decades. In a recent report that says the demand for 1BHK flat for sale increased to 54% whereas the supply was only 38%. The report also suggested that the demand for 2BHK flat for sale and above had supply more than the demand.
The average income required for owning a home in Mumbai is the highest among major metropolitan cities in India. It was reported to be 67 to 90 times more than the average income of other cities.
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