Nearly 2 lakh unsold flats in Mumbai region, says report

MUMBAI: The Mumbai Metropolitan Region (MMR) has 1.71 lakh unsold apartments worth a humungous Rs 1.80 lakh crore, according to a Knight Frank report released on Monday.

Of this, Rs 50,000 crore worth of unsold apartments are in south central Mumbai. This zone comprises 36% of the total value of unsold flats in MMR. But this area has only 4% of the 1.71 lakh flats in the MMR. Till June-end, there were 6,214 unsold apartments in south central Mumbai. Mumbai topped the list with highest sales volume growth of 22.93% in the residential segment, followed by Bengaluru with a growth of 18%. Hyderabad saw an increase of 8.10%, while the Pune market remained stagnant.

Samantak Das, chief economist and national director of Knight Frank India, said, "South central Mumbai (Parel, Worli, Nepean Sea Road, Colaba) is the most expensive real estate market in India. It is bigger than the entire Chennai, Hyderabad, Kolkata and Ahmedabad markets.''

"The current unsold inventory in south central Mumbai will take five to six years to sell,'' added Gulam Zia, executive director, Knight Frank. Independent property market sources expect an estimated 2,500 apartments in this area to hit the market in the next one year, which could lead to a major glut. Every year, builders in south central Mumbai sell Rs 8,000-10,000 crore worth of apartments.

"While the National Capital Region (NCR) of Delhi has the highest unsold inventory of 2,00,398 units, MMR has the highest value of unsold inventory at Rs 1.80 lakh crore,'' said the report.

NCR and MMR alone account for 62% of the country's inventory of Rs 3.90 lakh crore.

The India Real Estate report said H1 2016 witnessed the lowest number of new launches in the last three years across the top eight cities, as developers were cautious because of the huge unsold inventory that has been piling up since 2013. New launches reduced by 9% in the last six months, from 1,17,200 units in H1 2015 to less than 1,07,120 units in H1 2016. This is down by 54% from the 2,32,490 units that was observed in H1 2013.