Housing project proposals witness 50% drop in Mumbai

The lukewarm response to the real estate market amid skyrocketing prices has resulted in a 50% drop in new housing project proposals in the city in the past year. The building proposal department received 22 proposals in December 2010 as against 44 in January that year, according to data collected by the Brihanmumbai Municipal Corporation (BMC).

The number of proposals stood at 46 for February and 44, 38, 49, 31, 38 and 40 for March, April, May, June, July and August, respectively. The figures for September, October and November were 21, 29 and 27, respectively.

Sunil Mantri, president of Maharashtra Chamber of Housing Industry, feels there will soon be a time where there won’t be any housing project proposals. Developers are fed up with the working style of new BMC chief, Subodh Kumar, he alleges.

“The civic administration is sitting on the proposals and the files are not moving fast. The commissioner is not willing to look at new proposals. If he does not have the time, he should delegate the responsibility to someone else. Else, there will be a shortage of houses in the future,” Mantri told DNA.

The developers are liable to get concessions to construct more floors and facilities. However, the commissioner has neither clarified his stand on the issue nor is he framing guidelines to grant concessions. “We cannot reject every proposal because of the Adarsh society scam. We need to move on, follow certain rules and take precautions. Otherwise, development in the city will come to a standstill,” said Mantri.    

Deputy municipal commissioner (director) Ashok Shintre, however, denied that there is a delay in clearing files. “If there are genuine proposals, we scrutinise and clear them immediately. I cannot comment on why there are fewer housing proposals,” he said.

Sources said developers are playing it safe and not launching as many projects because of the lukewarm response to the real estate market. “Earlier, each developer would create 500 houses. Now, they are playing with a small volume. It helps to mitigate the losses. This could be the reason for developers not willing to submit more proposals,” said Kaustav Roy, executive director, Cushman and Wakefield.

He said the reasons for the declining number of proposals could be that the developers are facing monetary constrains, shortage of sand, rise in construction cost and the administration delaying the procedure.

“It will have adverse affect on the supply of houses. Prices of houses may also go up in the coming days. To bring back normalcy, there should be a healthy relationship between the developers and BMC for the larger interest of the city,” Roy said.

A senior civic official told DNA, “At present, we are clearing the pending proposals. Developers are not coming forward to follow up on the submitted proposals.