Expiry of the stamp duty cut period further ads to the peril
Property consultant Anarock said on Wednesday that the housing sales will be impacted across major cities during the April-June quarter because of the rapid spread of the Coronavirus disease. Already, property registrations in Mumbai, a key market in Maharashtra and the country, have dropped due to the second wave of Covid-19 pandemic and restrictions to curb it, it added.
Quoting data by Inspector General of Registration (IGR), Maharashtra, Anarock said the stamp duty cut period between September 2020 to March 2021 saw as many as 80,718 properties registered in Mumbai, up 114 per cent from the corresponding period (September 2019 to March 2020). Total revenue collected in Mumbai between September 2020 to March 2021 (period of stamp duty cut) was Rs 2,914 crore, almost the same as in the same period a year ago (at Rs 2,958 crore).
"Latest government data already indicates a drop in property registrations in April 2021 over March 2021 amidst second Covid-19 wave and no stamp duty cuts," Anarock pointed out. The second Covid-19, wave coupled with the expiry of the stamp duty cut period, will impact the monthly growth momentum of Mumbai's housing sector, the consultant said.
During the period of stamp duty cut, there was consistent month-on-month growth in sales.
Prashant Thakur, Director, and Head – Research, Anarock, said, "Ever since the expiry of the stamp duty cut period started from 1st April onwards, there has been a marked drop in property registration numbers. Besides the expiry of the stamp duty cut period, the second Covid-19 wave and the restrictions aimed at curtailing the city's caseload have contributed towards the declining numbers". The government should seriously consider extending the stamp duty reduction to keep the property sales momentum going, he added.
Overall, Thakur said, the housing sector is better equipped this time around as more developers have developed digital marketing capabilities and the government has allowed construction activities to continue.
"However, the April-June quarter will certainly be impacted by the rapid spread of the virus," he said. The restrictions on interstate movement and the call to steel manufacturers and fabricators to allocate their oxygen supplies to the hospitals have put pressure on the supply chain, Thakur said.