Stamp duty collection shot up in Mumbai in October due to strong real estate sales

1 Nov 2022 , 09:52 AM

As the holiday spirit fuelled homebuying activity in October, Mumbai, the nation’s largest and most expensive real estate market, continued to experience record velocity in stamp duty collection.

The nation’s financial capital market also had its second-best Diwali ever and surpassed the milestone of one thousand registrations in the first ten months of the year.

The real estate market has reached its highest stamp duty collection level for the month of October ever.

According to data from the Maharashtra inspector general of registration, there have been over 8,361 property deals registered in the market, generating over Rs717 crore in revenue. Even though there were a few fewer registrations in October than a year prior, the state exchequer received 30% more money from stamp duty.

The holiday month of the year, October, had the second-best Diwali season sales. The best registration numbers occurred during Diwali in 2020, which happened in November of that year and was aided by the concession of lower stamp duty, totalling over 9,300. The incentive had been extremely important in restoring Mumbai’s real estate market.

For the first time in ten years, property registrations have already surpassed the one hundred thousand mark in just ten months. This early in the year, strong sales momentum in 2022, supported by October 2022 sales, is evident.

Between January and October 2022, 1,03,557 properties were registered, an increase of 9% from the previous year. While the government’s revenue collection increased significantly by 53% during this time, the best growth in the previous ten years, crossing Rs7,300 crore.

Despite ongoing challenges like the implementation of the metro cess, which increased the stamp duty by 1%, developers choosing to raise prices to offset rising input costs, and higher housing mortgage rates after the repo rate increased by 190 basis points in the previous two quarters, the market held strong throughout the Diwali festival.

While the activity has been affected by rising interest rates, holiday deals from real estate developers that include absorbing higher interest rates on behalf of homebuyers have temporarily sped up deal completion. The initiative taken by realtors to implement mitigation measures to lessen the impact of the increasing interest rate regime on potential homeowners’ affordability levels has contributed to the maintenance of a strong sales momentum.

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