50% drop in property registrations in April in Mumbai

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Stamp duty cut from April 1 has led to a 50% drop in property registrations and stamp duty revenue in Greater Mumbai this month compared to March.

Between April 1-28, only 8,754 property documents were registered in the city, while revenue collection as stamp duty was Rs 464 crore. In March, data shows 17,728 property documents were registered, which earned the state Rs 875 crore.

Similarly, stamp duty revenue collected across Maharashtra in March and April showed a sharp difference. In March, the state earned Rs 9,067 crore as stamp duty when 2.13 lakh property documents were registered. In April (till Wednesday afternoon), the collection was Rs 1,103 crore from 83,843 registered documents.

The main reason for a sharp drop, said Pankaj Kapoor of Liases Foras, which compiled this data, was the state decision not to extend stamp duty benefits. Last year, when the first wave of Covid-19 crippled the real estate market, the state government slashed stamp duty from 5% to 2% from September 1 till December 31, 2020. It was then marginally increased to 3% from

January 1 till March 31, 2021. The duty cut led to a surge in apartment sales during between September 2020-March 2021. Developers urged the state to extend the benefit, but the government rolled back the duty to 5% from April.

Kapoor said, “Stamp duty reduction was a big motivator for consumers to purchase properties. After it was rolled back, it took a big hit. The second pandemic wave this month further impacted the market.’’

“Government should have continued the incentive of stamp duty for some more time. Builders will now have to roll out more offers to entice customers,’’ he added. Market sources said many secondary transactions have happened over the past few months. M any investors, holding on to properties, offloaded stock to take advantage of the stamp duty cut.