Now, the price of resale flats has slipped by 10% to 20% in Mumbai, a fallout of the slump in the real estate sector, which had so far impacted only new properties, said property experts and brokers.
Buyers have now become very price sensitive, said Vishal Kadrekar, proprietor, Fair Value Property. “This is a bargain market, and buyers are now negotiating in a big way,” he added.
Take the case of Ashok Gardens in Sewri. Currently, the rates being quoted for a 2 BHK (bedroom hall kitchen) are Rs4.28 crore, compared to Rs4.75 crore to Rs5 crore a year ago. Similarly, a 3 BHK apartment at Casa Grande, Lower Parel, which used to command Rs10 crore, has now fallen to Rs8.75 crore.
The slowdown has taken its toll on the resale value of apartments in the island city as well as the suburbs.
A 2 BHK on the plush Ambedkar Road and Pali Hill, in the Bandra-Khar belt, would have cost Rs5 crore a year ago, but now it has dropped to Rs4.25 crore. Similarly on JP Road in Andheri (west), a 2 BHK that now costs between Rs1.7 crore and Rs2 crore fetched Rs2.4 crore a year ago.
Prakash Rohera, CEO, Kkarma Realtors, said it is a buyer’s market. “The secondary resale market is now competing with the primary market as builders are offering a lot of discounts.” Also, rates are coming down because “sellers who were waiting for their properties to monetise have realised that prices are not going to appreciate further and are selling,” Rohera explained.
Pankaj Kapoor, CEO of real estate research firm Liases Foras, calls it the rationalisation of prices. “Investors see no sense in holding onto their apartments anymore, and are now selling to make profit on their investments. Renting out the flat is not an attractive option as the yield is just 1.5-2.5 % of the value of the flat,” Kapoor said, adding that investors want to put the money made from apartment sales into stocks as the markets are doing well.