Will Mumbai property prices ever come down
It’s a question every home buyer has in mind when he gets pesky msgs and calls with numerous offers every few days. The Mumbai property market in August 2015 is ripe with various news articles and research reports suggesting that the markets will fall.
The truth here is that, if you look at the consumer side, the majority of investors who used to be active have settled down and matured. They have entered at far lower levels, got their possession and now sitting on the lease rent income and content with their appreciation.
The entry load to enter into the real estate market in India is any where between 10 to 14% and these are only taxes payable to the government like Stamp Duty, Registration, Vat and Service Tax.
Now, let us add more Floor Rise, Car Parking, Development Charges, Legal Charges, Infrastructure Charges, club house, taxes, possession charges etc. so this can be an additional 5 to 10% or even more than the base consideration value, so this means the cost of the acquisition is not just the base price but an additional cost of 20 to 30% and if you go in for higher floor, this cost can further spiral up. While exiting the investor is not getting the desired runs in a lot of projects. The only investments, which can offer return is of Top developers, who have acquired properties at inception stage.