Liases Foras’ December quarter figures show at the current rate of sales, Mumbai builders will need 44 months to clear their inventories
While other cities are seeing increased sales of residential units, buyers in Mumbai are scarce. The latest data released by Liases Foras on the December 2011 quarter shows that Mumbai has seen a 30% year-on-year decline in sales, while NCR, Pune, Chennai, Bengaluru and Hyderabad have all recorded growth.
Yet, Mumbai, along with NCR, has seen a price rise of 25% year-on-year, the highest in India. Among six cities Mumbai has fared the worst with a “sales velocity” of 1.26%. Sales velocity refers to the rate of property offtake.
At the present rate, the city will need 44 months to clear unsold inventory of 112million square feet of area. Mumbai is also the costliest, with the average price of a flat now being Rs1.09 crore, where the price per square feet of area is Rs10,559 on an average.
Compare that to the prices in other cities: in NCR, total cost is Rs52 lakh at Rs3,395/sq ft, Rs45 lakh for Pune at Rs3,860/sq ft, Rs68 lakh at Rs3,859/sq ft, Rs56 lakh for Hyderabad at Rs3144/sq ft and Rs47.29 lakh for Chennai at Rs3,826/sq ft.
Even during the September 2011 quarter, Mumbai’s flats cost Rs10,021/sq ft, while other cities were lagging far behind.
Pankaj Kapoor, MD, Liases Foras, said, “The Mumbai market is in a confused state. Builders’ plans about FSI, etc, have gone for a toss after the new DCR came in. They have to get new plans. We are seeing many projects in the central and western suburbs are getting stalled. The prices have peaked, inventory pile up is huge. It is the most inefficient market.”
While Delhi-NCR has 232 million square feet of unsold space, it will require 31 months to clear the inventory. NCR has a sales velocity of 1.62%. Mumbai sold only 8 million square feet of area in the December quarter, which was worth Rs5,337 crore. In terms of sales velocity, Pune is the most efficient market, with 3.13%, while Chennai comes next with a velocity of 3.02%.
However, Bengaluru has shown an astonishing 106% increase in year-on-year sales, which may have come on the back of new infrastructure projects. “Bangalore must be approached with caution, because while sales are increasing, so is the inventory. Also, we are seeing launch of luxury projects, which may indicate a potential speculative market,” said Mr Kapoor.
Political happenings seems to have taken a toll on Hyderabad’s sales, which saw a 21% decline quarter-on-quarter, but Mr Kapoor says that it is an efficient market where existing inventory is getting depleted while new launches are not taking place.
While increasing passenger fares after eight years, the railway minister said that it will be rounded off to nearest five rupees
Railway minister Dinesh Trivedi, in his first Railway Budget, has increased passenger fares steeply even as he kept mentioning his party boss Mamata Banerjee’s name throughout the budget presentation. Surprisingly, it was Ms Banerjee, who during her entire tenure as railway minister took the populist decision of not hiking passenger fares. And not surprisingly, there are reports that she is not too happy with the passenger fare hike.
“I propose to rationalise the fares to cause minimal impact on the common man and to keep the burden within tolerance limits in general. I am asking for an extra only 2 paise per km for suburban and ordinary second class. Similarly, increase for mail/express second class will be by only 3 paise per km; for sleeper class by only 5 paise per km; for AC Chair Car, AC 3 Tier and First Class by only 10 paise per km; AC 2 Tier by only 15 paise per km; and AC I by only 30 paise per km,” the minister said while presenting the Rail Budget in the Lok Sabha.
The fare hike appears to be minimal, when one looks at it by using paise as a unit. But when you look at it through the distance, the situation becomes clear. For a sleeper class, the fare hike works out to be 50 paise for 10km, Rs5 for 100 km, Rs50 for 1,000 km and Rs75 for 1,500 km. Most of the long distance trains in the country, like Mumbai-New Delhi, Delhi-Kolkata, Delhi-Chennai or Ernakulum, cover a distance of over 1,000 km. With the same logic, for the Delhi-Mumbai AC 3 Tier, you would now have to shell out a minimum of Rs150 more.
Admitting that passengers do face hardship due to non-availability of loose change, the railway minister, said he decided to incorporate a rounding off mechanism in fare structure. “For all ordinary and mail and express trains, rounding off will be to the next nearest five rupees. However, for the suburban passengers, I propose to permit a limited exception in the form of downward rounding off also in a few cases. By way of example, a fare of Rs11 will become Rs10 and Rs6 will become Rs5. The minimum fare chargeable and the platform ticket will now be Rs5,” he said.
Just last week, the Railways increased freight rates by around 20%, except for iron ore. Therefore this was not mentioned in the Rail Budget.
Indian Railways have more than 8,000 stations and it is necessary that efforts towards improved availability of amenities like waiting halls, benches, adequate lighting, drinking waters, toilets and proper platform services. Indian Railway Station Development Corp will redevelop 100 stations in the next five years, the Minister said.
Speaking about recruitment, Mr Trivedi said, during 2012-13, the Railways is planning to recruit more than one lakh persons. With these recruitments, Indian Railways will also be wiping out the backlog vacancies of SC/ST/OBC and physically challenged persons and complying with the instructions of DOP&T, he said.
Faster Corridor: While talking about further strengthening and augmenting the suburban rail infrastructure in Mumbai, the Rail Minister said, Mumbai Rail Vikas Corporation (MRVC) will carry out feasibility study for construction of faster corridors on CSTM-Panvel and Virar-Vasai-Diva-Panvel sections through innovative financing mechanisms.
"The proposed 72 km link between Virar-Panvel 3rd line in the PPP mode will open new avenues for development of northern part of Mumbai and facilitate commuters to transit between eastern and western parts of the city. Feasibility of a spur from Panvel to Navi Mumbai airport will also be examined," he said.
Elevated Suburban Corridor: The financial modelling of an elevated rail corridor from Churchgate to Virar to be executed through PPP mode in coordination with the Government of Maharashtra is being firmed up. The proposed project will enable introduction of premium AC suburban rail services. A pre-feasibility survey for a similar corridor between CST and Kalyan is also proposed to be taken up in due course, the Minister informed the Lok Sabha.
New local services: With a view to further enhancing the carrying capacity of suburban services in Mumbai area, 75 new services in the Churchgate-Virar, Virar-Dahanu Road, Chhatrapati Shivaji Terminus-Kalyan-Kasara and Chhatrapati Shivaji Terminus-Kalyan-Karjat sections, Harbour and Trans-Harbour line will be run.
Utilisation of land: Mumbai Suburban Railway System has sound potential for mobilizing additional resources from commercial utilization of land and air space, thus providing funds for infrastructure development. I have asked MRVC to initiate a pilot project for commercial development, Mr Trivedi added.
12-car rakes on Harbour line: The Minister said, in order to address the transport needs in Navi Mumbai area, he was happy to announce that works will be taken up to facilitate running of 12-car rakes on Harbour line. A new double line work of Belapur-Seawood-Uran is in progress, which will provide direct passenger connectivity to JNPT, he added.
Here is the list of new Express Trains and Passenger Trains…
“We strongly recommend abolishing gold ETF investment in the country which is completely idle investment ... All India Gems and Jewellery Trade Federation also recommends introducing 25% commodity transaction tax on ETFs,” its chairman Bachhraj Bamalwa said
Kolkata: National jewellers’ body, All India Gems and Jewellery Trade Federation (GJF), has suggested abolition of gold exchange traded funds (ETFs) to prevent the shift from buying the precious metal from jewellers, reports PTI.
“We strongly recommend abolishing gold ETF investment in the country which is completely idle investment ... GJF also recommends introducing 25% commodity transaction tax (CTT) on ETFs,” its chairman Bachhraj Bamalwa said here today.
Gold ETFs are exchange traded funds of gold and a person can hold units of gold in demat form in more cost effective manner. The funds also offer liquidity on stock exchanges.
Previously investment in gold was done in the form of jewellery; Mr Bamalwa said adding jewellers have lost business by 30%-50% since October 2011.
According to GJF, 25%-30% of gold imports are being diverted to gold ETF investment. In 2011 gold imports were pegged at 969 tonnes.
GJF in its budget suggestion asked for increasing the limit of gold buying to Rs25 lakh from the present Rs5 lakh which would require furnishing of the PAN card.
The federation, however, expressed satisfaction on the government’s clarification on imposition of excise duty on branded jewellery.