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Real Estate Market In Mumbai

Real Estate Market In Mumbai

Real Estate Market in Mumbai Changing Decade to Decade

Period between 1950 and 1960

  • Rural urban migration was key driving factor

Period between 1961 and 1970

  • Rural urban Migration was key driving factor
  • Rapid industrialization owing to ‘licence raj’
  • Highly regulated development
  • Low profile development

Period between 1971 and 1980

  • High demand for Chawls for industrial employees and labour
  • Parallel increase in slums in urban centres
  • Highly inflexible Development plan
  • Highly restrictive Development control regulations
  • Policy of decongestion – inhibiting development
  • Lack of funds with municipal bodies

Period between 1981 and 1990

  • Industrial growth resulting in demand for rental premises
  • Urban center/ industrial center development
  • Proliferation of slums

Period between 1990 and 2000

  • Opening up of economy
  • Rationalization of interest
  • Real estate boom
  • Relaxation in laws
  • Incentives for development
  • Infrastructure development

Changing Paradigm

The paradigm of real estate in Mumbai is changing with the opening up of the economy and stabilization of the supply. The role of the Government is shifting from the regulator to a facilitator. Policies and regulations are becoming more development friendly and giving way for high density development. The supply demand scenario is stabilizing, and the market is consolidating in the wake of emergence of many players. The perspective of the developer is considerably changing. The consumer now is becoming more and more aware of the rights and is demanding befitting quality for the pennies spend.

Some of the salient features of this paradigm are

  1. Supply base to demand base market
  2. Stability in prices
  3. Awareness of product/rights
  4. Addressing safety issues
  5. Quality based pricing
  6. Match between demand and supply
  7. Opening of market due to globalization
  8. Reduction in housing interest component
  9. Quality awareness/ customer focus
  10. Impetus on infrastructure development
  11. Standardization of procedures
  12. Transparency in transactions
  13. Young stream of developers coming in market
  14. Tax incentives and benefits
  15. Development of comprehensive market information
  16. High disposable income with individuals
  17. Liberalization of industry
  18. Service sector development
  19. IT/ ITES development
  20. Financial services development
  21. Technical/ support services
  22. Hospitality/ recreation services
  23. Liberalization of industry
  24. Shift from primary/ secondary sector to tertiary sector
  25. Rationalization in industry
  26. Paradigm shift from profit oriented to service oriented
  27. Opening of Real estate sector for Foreign Direct Investment

Currently, the property market in Mumbai is robust and driven by sustained demand. Apart from the generic demand in the metros, we see a high potential in class I & II towns as the future driver of the Mumbai’s real estate market because the need for quality housing stock in these towns will be the highest. At the moment there is a horde of property for sale in Mumbai but a few years back, Mumbai especially the eastern Mumbai suburbs was considered one of the most underdeveloped area. But things have changed tremendously. Mumbai has seen immense development in the past decade. Realtors in Mumbai consider this sudden spurt in Mumbai real estate as part of the universal phenomenon of the explosion of the tier 2 cities across the country. The key factor behind the sudden rise of the real estate market in Mumbai is the changing policy of the Indian government toward foreign direct investment and joint ventures. The Indian government is relaxing and is keen to liberalize its trade regulations for multinationals.

The year 2016 saw the government authorities over-regulating the real estate sector. Besides, we have noticed an increase in development charges and premiums as well, which in turn has led to prices remaining on the higher side. The sector was also marked by many new and innovative schemes introduced to attract home-buyers. However, many of these schemes and offers did not work in favour of the developers. Ready-to-move-in properties were preferred over under-construction projects.2016 was a year of consolidation for the developers where a majority of the reputed developers did not launch any new projects and focused solely on completing their existing projects and selling the pending inventory.

  1. Housing loan rates significantly drop, which leads to more disposable income in the hands of potential home-buyers;
  2. The demand for ready-to-move-in properties will also increase among home-buyers;
  3. RERA-compliant projects will be more preferred by home-buyers.

Posted on 02nd February, 2017

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Category : News

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Tags : beauty, popular, success

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