Mumbai's most expensive plot re-auctioned for less

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posted on 12 years ago — updated on 1 second ago

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The plot, auctioned for a whopping Rs 1.28 lakh per sq m last year, went under the hammer for the second time.

Mumbai: After bidding nearly twice the prevailing market rate for a plot in Ghansoli last year, the successful bidder failed to arrange funds, forcing the City and Industrial Development Corporation of Maharashtra Ltd (CIDCO) to re-auction the plot, revealed sources. In May 2011, plot number 15 in sector 8 fetched Rs 1.28 lakh per square metre in a CIDCO auction. However, when it was re-auctioned this week, the same plot was sold at Rs 1.11 lakh per square metre.

This incident is just an indicator of the decline in realty rates in the region after the initial surge last year. The reduction in price comes at a time when housing rates show no signs of sliding in spite of surplus flats in the Mumbai Metropolitan Region (MMR), according to property experts. So, is this the indication that the property market is ready for a correction, which will bring cheer to genuine homebuyers? "Probably," said a builder from Navi Mumbai, "builders do not have funds, they cannot spend anymore, and this is a sign."

Arvind Goel, senior vice president MCHI-Navi Mumbai said, "Prices are down by 15 per cent in Navi Mumbai and this is an example. Earlier developers acquiring plots paid any amount to get land. However, now things have changed and prices that are being quoted are normal and affordable. This will help provide affordable housing to the public."

Moreover, the said land, nearly 40 km away from the island city, is close to the highway.

"There is hardly any land transaction taking place in Ghansoli. Only due to plot number 15's proximity to the highway, it fetched a high sum. Else, it would have been much lower," said another builder, on condition of anonymity.

Along with plot number 15, there were five other plots from the same sector on sale, and according to a real estate source, these fetched Rs 78 to 85,000 per square metre.

However, Manohar Shroff, a developer from Navi Mumbai, said, "The price at which the plots have sold are reasonable. The base price set by CIDCO was Rs 19,000 per square metre. If CIDCO sells us land at cheaper rates, then why hike the price of flats? We will be able to give away flats to end users at cheaper rates only when the plots are bought at a reasonable price."