The bull run in Indian luxury housing continues even, while property prices are on the rise.
A surge in luxury residential properties is seen to be the reason behind Mumbai, the country’s largest and most expensive property market, setting a new record in property sales in February.
As per Inspector General of Registration (IGR), Maharashtra, Mumbai saw revenue collections from property registrations touch new high in February 2023 at $133.5 million (Rs 11.02 billion), a whopping 79 percent jump from February last year.
Anuj Puri, Chairman- Anarock Group, said interestingly, even while revenue collections went up significantly in the period in Mumbai, the total number of property registrations saw a drop of 8 percent in the year – from 10,379 total registrations in last February to nearly 9,511 registrations in February 2023.
“This clearly indicates that the sale of big-ticket price homes -i.e. luxury homes – saw significant movement,” Puri said.
Anarock said February 2023 has seen the highest revenue collection in Mumbai in the last five years during the same month, as also in entire FY 2023.
“One major factor for high sales of big-ticket price homes in Mumbai and other top cities could be the government’s recent move in the Budget 2023-24 to cap capital gains at Rs 100 million.
This will come into effect from April 2023.
“Thus, to save tax on capital gains, the HNIs across top cities including Mumbai are rushing in close luxury housing deals before the financial year ends in March,” Anarock said.
Under the new Budget proposal, capital gains of over Rs 100 million from property or real estate transaction will be taxed from April 2023.
Previously, property owners could reinvest sale proceeds of any amount in another property to save paying capital gain tax.
Luxury sales share up across top 7 India cities
Anarock said the luxury housing segment has performed remarkably well post-pandemic, with overall sales rising steeply across the top seven cities.
As per its research, out of the total 365,000 units sold across the top seven cities in 2022, about 18 percent or approximately 65,680 units – were in the luxury category, priced above Rs 15 million.
Contrastingly, of the total 261,000 units sold in entire 2019, just 7 percent was in the luxury category.
Mumbai, Delhi National Capital Region and Hyderabad have led luxury homes sales in 2022 with approximately 50,100 units.
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