The Greater Mohali Area Development Authority (GMADA) received a jolt on Tuesday after out of 66 commercial sites put under hammer, only 18 were sold.
In the auction held at the community centre of Sector 70, GMADA earned only Rs 17.52 crore against the reserve price of Rs 15.53 crore. The 2% cancer cess on total auction price announced during the auction also forced the buyers to stay back. The last auction of commercial sites was held in November.
Compared to last months' auction, where GMADA sold its 4.60-acre site for a housing project in Sector 70 for Rs 98.31 crore, highest-ever against the reserve price of Rs 90 crore, the realtors this time feel that the current slump in the property market in the region has severely hit real estate transactions in the town as there are virtually no buyers in the market.
In the auction held for 66 commercial sites - booths, shop-cum-offices (SCO) and shop-cum-flat (SCF) - in sectors 53, 59, 61, 67, 65-A, 70 and 71 (pocket C and B), two SCOs in Sector 71 fetched Rs 2.61crore each against the reserve price of Rs 2.21 crore, while another SCO in the sector fetched Rs 2.58 crore.
The bidders showed less interest in booths. The highest price of a booth in Sector 67 fetched Rs 88.1 lakh against the reserve price of Rs 88 lakh.
There were no takers for SCFs and booths in Sector 53.
In the commercial auction held in November last year, GMADA earned Rs 62 crore by auctioning 18 commercial sites, indicating that smaller and reasonably priced plots were in demand. An SCO in Sector 61 then fetched the highest bid of Rs 6.2 crore.
Mohali Property Consultants' Association chairman Shalinder Anand said "High reserve price is one of the reasons why the auction failed to evoke response. Also, the investors are interested to buy plots or showrooms under land-pooling scheme as rates are very less in comparison to reserve price. The decision of GMADA to announce 2% cancer cess on Tuesday also forced the buyers to stay back."
He further said, "The current slump in the property market in the region has severely hit real estate transactions in the city as there are virtually no buyers in the market."
On the other hand, GMADA estate officer Navjot Kaur termed the auction as successful. "There is a slump in the market and in such situation we are considering the outcome as good."
GMADA auction at glance
Total sites - 66
Sites sold - 18
Total booths sold - 13
Total SCOs sold - 5
Two SCOs sold in Sector 71 fetch Rs 2.61crore each
A booth sold in Sector 67 fetches Rs 88.1 lakh
GMADA earns Rs 17.52 crore against reserve price of Rs 15.53 crore
Commercial auctions in the past
In November 2012, GMADA sold 18 of total 47 sites and earned about Rs 62 crore. An SCO in Sector 61 fetched Rs 6.2 crore against a reserve price of Rs 3.35 crore
In November 2011, GMADA sold 42 of the total 61 sites. An SCO site in Sector 70 fetched Rs 5.94 crore.