Real estate prices in the city have risen between 5 to 20 per cent since January. A surge in demand and buyers willing to pay more has helped this rise.
Take the case of Residencies, a 250-flat project launched by the Unitech-Omkar group at Parel, which is now commanding a rate of Rs 11,000 per square foot, up from Rs 9,875 pr square foot in January this year.
“There is no other project in the vicinity like ours and hence we hiked the rates. We are getting a good response,” said Babulal Verma, Managing Director, Unitech Omkar.
Another example of rising market rates is Sanghvi Exotica, a Sanghvi Group project at Dahisar. Prices have gone up from Rs 5,850 per square foot three months ago to Rs 6,700 per square foot.
“The market is ruled by sentiment and since there is a positive wave, we are just taking advantage of it,” said Shailesh Sanghvi, Director, Sanghvi Group.
Along with a positive sentiment, the Maharashtra Chambers of Housing Industry (MCHI) has attributed the increase in prices to other factors. “Prices of the raw materials, especially of steel and cement, have increased exorbitantly,” said Pravin Doshi, President, MCHI.
“We are also burdened with various taxes such as the service tax and value added tax, which adds to the cost of the project,” he added.
Real estate experts also attribute the increase on buyer sentiment. Pawan Swamy, Managing Director (Western India), Jones Lang LaSalle Meghraj (JLLM), a leading real estate consultancy firm, said: “Since the tax slabs have changed offering more money in the hands of the buyers and the job market has stabilised, people are now buying property thus reviving the realty market.”
However housing activists are unhappy with the rise and have demanded a regulator to monitor such issues.
“The whole industry is in chaos and only a proper regulator can bring in discipline in this vital sector. We need a body to really look after the welfare of the home buyers,” said Advocate Vinod Sampat, head, Cooperative Societies Residents, Users and Welfare Association.