Property prices in Navi Mumbai are set to shoot up following the sale of five prime plots in the area by the City and Industrial Development Corporation (Cidco) for Rs266 crore on Tuesday.
Developers believe that the high cost at which the plots were sold will lead to an inflation in the overall property rates in Navi Mumbai which, until now, offered affordable housing options.
Cidco had recently floated an advertisement inviting bids for five plots in Kharghar and Ulwe. An 8,800sqm plot in Kharghar received the highest bid at Rs1.72 lakh per sqm, helping Cidco earn a whopping Rs152.7 crore. Another 1,182sqm plot was sold at Rs1.40 lakh per sqm, working out to Rs16.54 crore. The third, a 1,555sqm plot of land, was sold at Rs1.22 lakh per sqm, raking in Rs18.97 crore.
In Ulwe, a 2,830sqm plot was sold at Rs1.51 lakh per sqm, fetching Rs42.73 crore. The fifth plot, also in Ulwe, was sold at Rs71,000 per sqm, putting Rs35 crore in Cidco’s kitty. This takes the total revenue earned by Cidco to Rs266 crore.
Initially, Cidco was apprehensive that due to the slowdown in real estate and economic sectors, there would be tepid respond to the bidding. However, developers rushed in large numbers to buy these plots and, in fact, quoted higher prices than expected.
Two years ago, the highest bid was opened at Rs92,000 per sqm rate in Navi Mumbai. “We are happy that Cidco has earned substantial revenue by selling its prime plots. This money can be used for enhancement of infrastructure in Navi Mumbai,” said a Cidco official who was part of the bidding process.
Manohar Shroff, secretary of Maharashtra Chamber of Housing Industry (MCHI), Navi Mumbai unit, said that the high cost at which the plots were sold will cause a further inflation in property prices.
“The cost of the plot is the main input cost in any project. If the developer had bought the plot at a high price then he will sell the apartment at higher prices to recover his cost and make a profit.
Cidco is not a profit-making body. They should sell plots at a reasonable rate so developers will construct and sell affordable houses,” said Shroff.