Tag Archives: Mumbai property market

Mumbai property on top of NRI’s wish list

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News Point: The demographic profile of the Non Resident Indians (NRIs) may not do justice to conclude why Mumbai is always on top of the wish list of the expat Indians.

NRI, Non Resident Indian, Indian Diaspora, NRI investment in property, Property market for NRIs, India real estate news, Indian property market, Track2Realty, Track2Media, Indian Diaspora investmentThe major demographic profile of the NRIs is from the states of Gujarat, Kerala, Punjab and other parts of North and South India. Going by what the traditional investment pattern of the Indians, the cities that should draw the maximum NRI investment should be Kochi, Ahmedabad and Chandigarh. But then it is the Mumbai city that has over the years commanded the maximum premium from the NRIs.

The slowdown of the Indian economy and the resultant effect on the property pyramid where the high-end investors started scaling down their portfolio size gave the impression that the NRIs who were fuelling the luxury property of Mumbai would be skeptical with the dream city. However, this proved to be an outside view as the NRIs who have travelled in developed cities of the world still find opportunity cost of Mumbai pretty high. In their cost & benefit analysis, Mumbai continues to be an investment magnet.

Critics who pointed out that the NRIs are exiting the luxury properties probably failed to differentiate between the NRI investors and the NRI end users. It is true that the investors are wary of ultra luxury projects across the country and Mumbai is no exception. But equally true is the fact that the kind of business opportunities, lifestyle and livability index that the NRIs looking to settle down in India want, no other city can match their aspiration level as Mumbai.

Mumbai magnet for NRIs

Mumbai a top pick among the NRIs professionals; retirees prefer hometown

 Mumbai still offers the maximum ROI on property investment

No other city offers the NRIs quality of life and business opportunities like Mumbai

Connectivity of Mumbai with other global cities act as a magnet for NRIs

Satish Dwivedi, and NRI from Western Uttar Pradesh now working in Yemen is coming back to India. The financial consultant was advised by the broker that Noida is a better option for settling down in India and exploring his business. The ticket size of the Noida market is not even 30 per cent of the Mumbai real estate and hence the advice prima facie looked very convincing. In terms of the cost of doing business per square feet, Noida was peanuts compared to Mumbai.

“With the impression that I was given I was pretty much convinced in favour of Noida since it is very close to my home town in Moradabad. The physical infrastructure of the place also is far superior. But then I soon realized that it could only be my retirement destination. In terms of conducting my professional and social life, no city can match Mumbai,” says Dwivedi.

The built environment of Mumbai real estate that deals with the NRI buyers do understand this wish list of the expat Indians. “The first consideration for any home-buyer is how will he conduct his professional life. Then after he has to look for conducting for social life. Then comes the question of budget and affordability which is very relative. For the NRIs since there is no budget constraint like an average salaried class in India, they would go for a city where they get the lifestyle choices along with professional opportunities,” says Arvind Nandan, Director – South Asia with Colliers International.

Ravi Gurav, Member of MCHI points out that Mumbai real estate market has been getting some good support from NRI sales since the last two years. The share of enquiries by NRIs on real estate portals are over 30 per cent in today’s times. Whereas the local buyers are still considering the property prices as high, at the same time NRIs are buying the best deals available from Mumbai market. From the month of August 2016 we are witnessing a lot of new launches along with existing launched properties offering better deals with relaxed payment schedule or free biz such as furniture and home appliances.

“NRIs are especially bullish in Mumbai real estate market due to two reasons. First is that they understand the gradual correction that taken place in Mumbai real estate market. Even if we consider the inflation from 2013 to 2016 at the rate of 5 per cent per annum then overall inflation is 15 per cent in last three years. But if we get the property in 2016 at the price of 2013 means it is at 15 per cent correction. Secondly, Indian Rupees against US Dollar depreciated almost 20 per cent from 2013 to 2016. The Indian Rupee against US Dollar was 55 in April 2013 where as in April 2016 India Rupee was 66 against US Dollar. Which is like the 20 per cent depreciation of Indian Rupee against US Dollar,” says Ravi.

As per this calculation, if we consider the consolidated effect of 15 per cent gradual correction and appreciation of US Dollar up to 20 per cent in last three years, it is as good as Mumbai real estate market poised at 35 per cent corrected price for NRIs and hence they are bullish.

Devang Trivedi, Managing Director of Progresive Group finds a sound financial rationale in the Mumbai property investment of NRIs. He points to the fact that the NRIs are used to low returns on investment in their country. So, in Mumbai rental income is equal to the appreciation in their country and whatever appreciation in property price rise they are getting is a bonus. Moreover, they have a long term option of returning to Mumbai  and have a self use option.

“Among all the different investment classes that is gold, silver, diamond & stock market, property investment is the most tangible & common sensible investment. Long term perspective in Mumbai remains a safe market because of limited supply  and ever increasing population. Ten times growth in Mumbai between 2003 and 2008 is giving encouragement to all the NRIs to invest in Mumbai, as back in their own country the property is the same with only 2 to 5 percent maximum growth,” says Trivedi.

Beyond all the cost & benefit analysis, the fact lies that Mumbai still offers the high livability index and the reasonable cost of doing business to NRIs. So, any NRI who is returning back to the country and wants to continue the professional life prefers Mumbai for investment. Despite the slowdown of the last few years, which has hit the property markets across the country, everyone understands that in terms of the ROI no city can match Mumbai. Add to it, the quality of life and the business opportunities, and Mumbai acts as a magnet to the NRIs. Last, but not the least, the kind of connectivity that Mumbai offers to all the major international cities is a magnet for NRI professionals returning back to India to set up business here.

By: Ravi Sinha

Can Mumbai turn into global financial destination?

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News Point: The plans are to transform Mumbai into global financial destination.

Reserve Bank of India, RBI, Taxation, Direct Taxes, SEZ, DTC, Track2Realty, india real estate news, track2media, real estate news india, ndtv, ndtv.com, aajtak, 99acres, 99acres.com, 99 acres, india property news, property news india, india realty news, realty news indiaMumbai has been the undisputed financial capital of India. The emergence of other business destinations, like Bangalore, Gurgaon or Pune could not take the sheen out of the city, even in the wake of infrastructure deficit and other urban problems plaguing the peninsular city. Now the Mumbai city is poised to elevate itself to the next level of business destination. The MMRDA (Mumbai Metropolitan Regional Development Authority) plans to make Mumbai a major global financial hub.

The MMRDA has announced that it has received three bids for preparing a master plan of an International Financial Services Centre (IFSC) at Bandra-Kurla Complex. MMRDA’s approval for building IFSC in Mumbai will favorably contribute in developing Mumbai as a Global Financial Centre (GFC).

Mumbai on way to global financial hub

MMRDA received 3 bids to prepare master plan of IFSC at BKC

The MMRDA has received bids from a consortium of Tata Consulting Engineers and Townland Consultants of Hong Kong; INI Design Studio of Ahmedabad; and Ramboll and Henning Larsen Architects of Denmark

GFC will attract FDI and domestic investment into the city

Entry of foreign financial companies to make Mumbai more business competitive 

Mumbai already is the primary financial center for India, housing the major Indian stock exchange like the BSE, brokerages, asset management companies (including majority of the mutual fund companies), headquarters of most Indian state-owned and commercial banks, as well as the financial & monetary regulatory authorities of India (SEBI and RBI among other institutions). Mumbai has a cosmopolitan flavor and offers a much better culture for financial services than other cities in the country.

On the other hand, lack of physical infrastructure and the developments not keeping pace with rise in population has been a major problem faced by the city. Also government regulatory policies need to be streamlined and become more business friendly if Mumbai is to make rapid strides in its development policies. Further liberalization is requires if the city is to attract global investment and business to this part of the world.

Thus, while there are inherent strengths of the city as GFC, there are shortcomings which need to be considered. This strengths and loopholes include:

Strengths:

Facilitating FDI: Recognized as GFC, Mumbai will attract many international corporations to set up their base in the city proportionally providing efficient services to the consumers. This will also facilitate foreign direct investment in the city, thereby accelerating the state’s economical position and its contribution to the country’s GDP.

Venture Capital/Investment Banking: Establishment of IFSC will give a major boost to venture capital and investment banking domain. This will result in financial sector expansion, new products and services in the market, smart technological innovations and new investment portfolios enhancing the lifestyle of the consumers.

Weaknesses:

Threat to local industries: While GFC will boost many sectors and industries, it will also pose a threat to small domestic industries. With the entry of global players with their technology and investments, local players might not be in a position to compete with them after a given point, especially in a market like Mumbai which is already saturated with other prominent players.

Though the shortcoming of the city as GFC will have a substantial impact to the small businesses but positive implications and a slew of constructive changes will result in bringing optimistic implications to all the stakeholders.

Opportunities:

Chain of financial centres: Developing one successful GFC can pave the way for more such financial centres since Mumbai has many pockets of economic influence. After BKC, more such GFCs can be developed in places like Nariman Point, Parel, Andheri and Navi Mumbai. This will make Mumbai the global financial destination in true sense of the term.

Threats:

Infrastructure bottlenecks: Since the financial centres attract more human movement and demand for residential spaces in and around, it may prove to be an infrastructure nightmare, if the existing infra is not upgraded on an urgent basis.

Escalation in property prices: More demand of property in and around the GFCs means more pressure on the demand side, thus leading to property price hike. This can lead to uneven urban growth since this has a chain effect on the lower demand in other areas beyond the GFC.

Sector optimistic

Manju Yagnik, Vice Chairperson of Nahar Group maintains that the MMRDA has a Master Metro plan in place, with regards to which it had already got Maharashtra State Government’s approvals for Metro 3 (Colaba-Bandra-SEEPZ) and Metro 4 (Wadala-Ghatkopar-Thane-Kasarvadavli). With the help of World Bank, MMRDA has formulated this project in order to improve the traffic situation in Mumbai, through better transport connectivity.

There will be a fast corridor project built from CST (Chhatrapati Shivaji Terminus) to Panvel, along with a connection to the planned new airport (at Navi Mumbai). This also includes a traffic dispersal model for efficient mobility and connectivity.

“The infrastructure planned would develop North-South road links in the suburbs including a Mass Rapid Transit connectivity, Facilitate safe and convenient movement for pedestrians (Subways/FOBs/Footpaths including Skywalks), strengthen and augment East-West connectivity in the suburbs. It will also provide for efficient and fast public transport corridors, provide high capacity uninterrupted road connection to both the Airports, provide bus terminals and create facilities for passengers,” says Yagnik.

The MMRDA has already planned to make Mumbai a smarter city by having five new business hubs in Kanjurmarg, Kalyan, Bhiwandi, Kalwa and Vasai-Virar which will be well connected in terms of transport through metro and road. The efforts are clearly seen, and one could expect Mumbai to become a very well organized city in the next decades. 

Kaizad Hateria, Brand Custodian & Chief Customer Delight Officer, Rustomjee Group points out that ever since its formation in 1975, MMRDA is immensely contributing to make MMR a business hub through extensive infrastructure development enhancing the lifestyle of Mumbaikars. Constant development of groundwork projects across the sectors like housing, transport, water supply and environment have made Mumbai globally recognized for its relentless contribution in country’s economy.

“In alignment of on-going developments, MMRDA is also focusing to take Mumbai a notch higher through the development of International Financial Services Centre (IFSC) thereby developing the state as a global financial hub (GFH). Working towards the dream project of Devendra Fadnavis, MMRDA had set the ball rolling long back in February 2016 by setting up a process for establishing IFSC. Though the path is difficult in the current scenario with regards to other infrastructure projects in pipeline, MMRDA will be in a position to draw a feasible solution at the earliest,” says Hateria.

Opportunities galore

The professionals in Mumbai are also optimistic. Javed Iqbal, a marketing professional with an MNC points out that of late the job opportunities in Mumbai were not as good as it used to be. He feels the emergence of GFC will change the dynamics of job market as well, thus reviving Mumbai as a job market once again.

“The emergence of other job market locations like Pune or Nashik had taken some sheen out of Mumbai which used to hold the traction for professionals. With more global financial centres in Mumbai, the city will yet again be first choice for professionals due to more employment opportunities and better salaries,” says Iqbal.

Mumbai is naturally blessed with a natural and safe port with fair weather much of the year round. The city has been a center for trade and commerce over the centuries; which have now grown to be regarded as the commercial capital of the country.

Mumbai has traditionally owed its prosperity largely to its textile mills and its seaport till the 1980s. These are now increasingly being replaced by industries employing more skilled labour such as engineering, diamond polishing, healthcare and information technology and many more diversified industries. Now is the time to take it forward to the next level of economy. 

While developing Mumbai as GFH, positive implications have already started rolling in with more FDI pouring in different sectors and international brands and conglomerates are establishing their base in Mumbai. With the current efforts by MMRDA to develop IFSC, it will be soon that Mumbai emerges as a home to many international companies, further branding MMR as a global financial hub.

Waterways to reignite Mumbai real(ty) landscape

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Bottom Line: As the plans for Mumbai getting this new mode of commute in form of waterways is now more or less final, the built environment of city real estate is evaluating its own cost & benefit with the new development.

india realty news, india real estate news, real estate news india, realty news india, india property news, property news india, india news, property news, real estate news, India PropertyAcross the peninsular cities of the world the use of waterways transport has been a matter of raging debate. Some of the cities have successfully done it to ease the load on the road traffic.

However, in Mumbai the choice is not between ‘whether or not’ anymore but between ‘how to do it and how fast it can be done’. After all, the load on Mumbai roadways and the resultant traffic snarls suggest that the only alternative, viable and effective transport in the city could be with waterways.

As a matter of fact, the plan is not just for the waterways but going beyond it to ease the city transport with Roll-On Roll-Off (Ro-Ro) ferry based connectivity. Maharashtra Chief Minister Devendra Fadnavis recently announced that sea-based Ro-Ro services would link South Mumbai, Navi Mumbai and Alibaug; and that the services would start by end-2018.

Smart transport? 

Waterways RORO ferry service is being conceived as smart transport solution in Mumbai

From Mumbai through Alibaug and beyond, in the Konkan Region, water linkages over the years have been restricted to passenger ferry services

The sea-based Ro-Ro services would start from 2018

Waterways transport would link the triangle formed by New Bhaucha Dhakka in South Mumbai; Nerul in Navi Mumbai and Mandwa, near Alibaug  

The Chief Minister has said that the provision in this regard had been made in the new ports policy, which apart from ferries, also mentions catamaran and hovercraft services. Once this project being completed as per schedule, connectivity between South Mumbai and Alibaug will translate into a few minutes across the sea.

Needless to say, it will not just reduce the travel time, but also bring many far off locations closer to the main city of Mumbai. From Mumbai through Alibaug and beyond, in the Konkan Region, water linkages over the years have been restricted to passenger ferry services but things are all set to change.

Catamarans and Ferries along with new jetties and road connectivity will provide Mumbai and its neighbouring coastal areas with Ro-Ro ferry based connectivity, and water transport will be the infrastructure linkage that will ensure connectivity between South Mumbai and now a far off location like Alibaug.

The sea-based Ro-Ro services would start from 2018, and would link the triangle formed by New Bhaucha Dhakka in South Mumbai; Nerul in Navi Mumbai and Mandwa, near Alibaug. The Mumbai Port Trust is building a terminal at New Bhaucha Dhakka; CIDCO is similarly building a terminal at Nerul, while the Maharashtra Maritime Board is doing the same at Mandwa.

In terms of enhanced connectivity, for a coastal city like Mumbai, the sea-based Ro-Ro services for connectivity to Mandwa would be an apt option, rather than the long, circuitous drive from SoBo via Sion and Panvel.

From the perspective of connectivity between South Mumbai and Alibaug, the Ro-Ro ferry would be ideal; Mumbaikars could drive onto the Ro-Ro ferries at the New Ferry Wharf and a short sail later, drive off at Mandwa, bringing the hinterland of Alibaug closer to Mumbaikars. Better connectivity will result in higher tourism, giving the region’s development as also the state’s economy a fillip.

Analysts believe that Navi Mumbai and Panvel along with Alibaug have the potential to develop into an economic powerhouse, and this sort of connectivity will provide a fillip to the positives that the Navi Mumbai Airport will bring to the region.

However, Vijay B Pawar, Director, Mirador Dwellers asserts that the waterways will change the dynamics to a certain extent but not to an extent where it alters them completely. People residing or working in Mumbai still prefer Mumbai only as their first choice of residence whenever presented by one. Alibaug still has a lot of distance to cover to eventually compete with Mumbai aggressively.

“One major concern which dampens the spirit of those who do think of making a move to Alibaug and travel every day using the waterways to and fro their workplace in Mumbai is the fact that the waterways transport is yet to develop and reach a stage where people can use it to travel effortlessly and fearlessly even during monsoons,” says Pawar.

Parth Mehta, Managing Director, Paradigm Realty nevertheless believes with the entry of a new mode of transport coming in the form of waterways, Alibaug Region is all set to witness a huge inflow of developers from Mumbai and across who would be developing luxury projects creating huge influx of visitors from the city who prefer Alibaug for leisure and would not mind investing in weekend or second homes.

“Alibaug is located just a few hour’s drive from Mumbai, and once the Ro-Ro ferry starts operating between South Mumbai (SoBo) and Alibaug, it will become even closer. Navi Mumbai and Panvel will benefit the most out of this development as new economic zones would be set up there due to its proximity to the port, this would be in turn decongest Mumbai. Also people who work in South Mumbai specifically in areas like Churchgate, Colaba etc and are looking to buy affordable projects can consider Alibaug as an option making it very convenient for them to travel to and fro creating a great opportunity for developers to encash in,” says Mehta.

It is not just leisure and tourism which will get a fillip; water-based transport linkages like the Ro-Ro would also result in better connectivity between Mumbai and other destinations in the Konkan region, through Mandwa – Alibaug. The water transport linking South Mumbai with Nerul will enhance connectivity with the Navi Mumbai airport.

Infrastructure growth in form of better connectivity through waterways, which includes new jetties, ferries and road linkages, will help develop coastal areas in Maharashtra from the economic perspective, while also giving a fillip to tourism development. This has the potential to create new development hubs in the Konkan region – while ensuring that Alibaug benefits from enhanced connectivity to South Mumbai.

Will DP 2034 address Mumbai realities comprehensively?

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Bottom Line:  Mumbai’s Development Plan 2034 promises to address the Mumbai realities in general and its housing shortage in particular but grey zones are challenging.  

Western Suburbs of Mumbai, Mumbai property market, Property in western suburbs of Mumbai, Indian real estate market, India property market, Indian realty news, India real estate news portal, Indian real estate website, Track2Media Research, Track2Realty, NRI investment in Indian propertyWithin the built environment of Mumbai’s urban planning an impression has gained ground that the Mumbai Development Plan (DP) 2034 is very revolutionary. It is believed that with proposed focus on affordable housing and opening of No Development Zone (NDZ), there will also be good stock of affordable housing and it will certainly affect the demand & supply cycle of city property market.

The larger issue, however, that needs to be debated is that whether the DP 2034 will address the Mumbai realities in general and its housing shortage in particular comprehensively? Will it compromise the natural barriers against the calamities and lead to urban catastrophe? Will there be enough open spaces left for the city to breathe?

Analysts are divided over the issue. One school of thought reminds that the opening of NDZ might provide additional dwelling units, it will definitely compromise the long-term sustainability of the city. Another school of thought says Mumbai is left with no other option and howsoever painful it may be the city planners are left with no other option.

Critics allege that the DP 2034 sacrifices the essential parameters of town planning which includes providing adequate open spaces around buildings, compliance to National Building Code of India and maintaining recreational areas and to provide a wide means of access within a layout.

There is a general apprehension that because of large-scale discretionary concessions given by the planning authority to almost each and every project, it may eventually compromise with the essential requirements once the new DP relaxes the norms. They suggest the DP must ensure that the BMC (Brihan Mumbai Municipal Corporation) should not grant approvals to projects which are devoid of recreational areas, open spaces and fire safety.

USPs of DP 2034 

DP 2034 opens NDZs for affordable housing

No Development Zones scrapped and the land categorized as Special Development Zone-I and II

The new Development Plan proposes FSI to accommodate the expected increase in Mumbai’s population

The new DP removes all ambiguity around calculations of what is counted in FSI

Grey zones of DP 2034

There is no clear time frame for implementation of DP 2034

Developers are disincentivized from providing amenities such as additional, parking more than prescribed by MCGM in their projects

Project cost, especially FSI related, may actually go up as most of the additional FSI comes to them linked to Ready Reckoner value

Most of the additional FSI is linked to Ready Reckoner value, thus adding to the project cost

Advocate Aditya Pratap of Bombay High Court categorically says that the Past experience with the ULC (Urban Land Ceiling) which had strong legislative provisions has not been happy. Despite the stipulation that open land had to be built only for mass housing, it did not accomplish its objective for the reason of large-scale violations and non-compliances. Massive housing schemes built on open land such as in Powai, Kandivali etc. bear a testimony where a strong law with strong provisions yet can fail.

“When an enactment such as ULC can fail, the legislatively weaker provisions of DP 2034 are unlikely to succeed. Also, as far as NDZ (No Development Zone) Opening is concerned, unless and until the schemes are themselves executed by a government agency like MHADA, it would fail. Time and again, private developers have demonstrated their inability to create mass housing. It is a rampant practice to construct luxury flats in place of the small flats for mass housing, leaving the economically weaker sections (EWS) in the lurch,” says Aditya.

Vipul Shah, Managing Director, Parinee Group does not agree with the premise when he says that the DP 2034 is focusing on affordable housing and opening of NDZ. However, the demand and supply cycle of the property market has nothing to do with the DP. It is purely dependent on the excess availability and the product available in the market. Secondly, the affordable housing is directly proportional to the ready reckoner land rate and hence actually affordable housing is not completely dependent on DP.

“In my opinion, the new Development Plan proposes FSI to accommodate the expected increase in Mumbai’s population. It is very obvious that both older DPs were planned for a smaller population as compared to actual population that lives in Mumbai today. The new DP finally removes all ambiguity around calculations of what is counted in FSI. Now, there are very few features like minimum prescribed parking by MCGM that can be built and not be accounted for as FSI,” says Shah.

The buyers in Mumbai are nevertheless happy with the new DP. They believe the plan ensures that there would be no future slums as it addresses the core issue of human habitation across the budget segment.

Rajeev Agnihotri, a home seeker in Mumbai feels that the existing plan of the city was not addressing the core issue of affordable housing. But with the controversial zoning of ‘No Development Zones’ (NDZ) scrapped and the categorization of this land as Special Development Zone-I and II, the policy makers have paved way for it to be opened up for the development of affordable housing and civic amenities.

“For a large share of Mumbai working population housing meant a rented dingy accommodation or living in the slums. Houses have for long been the luxury of the select few due to high cost. But the DP 2034 promises to change this housing bias that existed due to policy confusion,” says Agnihotri.

There is no denying that the new DP brings in much-needed simplicity and transparency, and reduces the scope for manipulation. However, there are certain grey areas that need to be addressed yet. There is no clear time frame for implementation of DP 2034. Moreover, the developers are disincentivized from providing amenities such as additional, parking more than prescribed by MCGM in their projects, as they are part of FSI to be paid for but may not generate direct revenue.

A section of developers point out that their project cost, especially FSI related, may actually go up as most of the additional FSI comes to them linked to Ready Reckoner value. Then use of private vehicles has been discouraged by prescribing lesser number of car parking where additional and visitor car parks would be calculated within FSI.

A section of the analysts even question that if the assumptions made on income levels are correct, how does the DP propose to allow for housing for the majority of Mumbai’s population. Will affordable housing remain a part of the puzzle that remains outside the DP’s consideration? How will power, water, road and drainage infrastructure for the excess housing stock be created? It seems the DP 2034 might have touched upon the grey zones of Mumbai real estate, it has not addressed the core issue of affordable housing comprehensively.

By: Ravi Sinha

Modest appreciation yet Mumbai property market steady

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Bottom Line: Contrary to general perception, NHB Residex shows Mumbai is quite a steady property market.

Mumbai City, Mumbai property market, Indian real estate news, Indian property market, NRI investment in Mumbai, Track2RealtyIf only the statistics show a real picture then the Residex of National Housing Bank (NHB) shows the market might have offered a modest appreciation, yet Mumbai is a steady real estate market.

The NHB data accessed till March 2015 shows how historically (since 2007) this market has not been witness to any sharp fall in terms of the pricing index. This is a huge endorsement keeping in mind the downward cycle of the Indian economy in general and country’s housing market in particular in the said period.

Of course, on a micro look the trend is location specific and while certain locations have outperformed quite a bit there are other locations that have been hit with price correction. But overall estimate of the city property market is steady. In the last four quarters, the real data of the said period might not be available with the Residex, what can be vouchsafed at this point of time is the fact that the trend is more or less the same as it has been till march 2015.

Quick bytes

  • Mumbai market along with Pune more steady than other top cities
  • Modest appreciation at a macro level; each micro market showing different trend
  • Projects coming up near new infrastructure developments witness to sizeable appreciation
  • Appreciation potential more with upcoming locations compared to established markets

Different opinion on price index

Parth Mehta, Managing Director, Paradigm Realty feels concerned when he says that over the last one year Mumbai has witnessed very digressed price trends across the city. He maintains that in certain suburbs prices have gone higher due to lesser availability of under-construction and ready stock, whereas in certain areas the volume of sales has increased where there has been higher supply of inventory but prices have not gone up.

“Mumbai is a very location specific market. Certain premium locations like in South Mumbai areas such as Walkeshwar, Carmichael Road, Worli sea-face and in Suburban areas like Juhu sea-face, Carter Road, Bandstand, prime location of Kandivali & Borivali (W) which are dominated by more of business centric population governed by lesser supply of under-construction and ready goods will indeed have price appreciation,” says Mehta.

Vineet Relia, Managing Director, SARE Homes believes that over the past few years, uncertainty around development plans and government approvals has created stagnancy in the overall real estate market. This has largely affected the two biggest drivers of real estate in India, Delhi and Mumbai. However, some of the recent announcements made by the state and central government have given a thrust to the real estate market of Mumbai. As per the recent reports, all these announcements have improved customer sentiments and impacted sale of properties in the areas surrounding outer Mumbai such as Thane and Navi Mumbai.

“In areas like Navi Mumbai and Thane property sales have increased as compared to last year. However, overall the city is experiencing a steady fall in new launches. According to the Knight Frank report, there was a 23 per cent decline in new launches in H2 2015, compared to H2 2014. During the second half of 2015, sale of housing units dropped by 6 per cent year-on-year and clocked slightly more than 34,000 units,” says Relia.

Price index location specific

An optimistic Kedar Joshi, CMO Ahuja Constructions nevertheless asserts that Mumbai market has shown a steady growth in the last four quarters, especially during the festive occasions there has been a considerable investment from buyers in the real estate market due to attractive offers and schemes. Buyers seeking homes are playing a wait and watch approach for a while, and are looking forward to make investments in the areas that offer good quality infrastructure and effective connectivity to all parts of the city.

“The price trend seen among buyers in Mumbai’s realty market is very location centric. A considerable demand pull is especially seen towards the central suburbs like Sion, Ghatkopar and Chembur which are the latest entrants into the location-centric investment run. A steady and positive movement is seen in the price trend particularly being focused on the upcoming and emerging urban sprawls,” says Joshi.

Sandeep Ahuja, CEO, Richa Realty, on the contrary, feels that in the last few quarters the overall prices have come down and are now stagnated at current levels. The fall in many micro markets in last four quarters has been between 7-18 percent.

I don’t see an upward trend for the next 2-3 quarters. Developers are still sitting on high inventory levels and would like to clear that before raising prices. We expect the absorption levels to improve in next few quarters and post that price appreciation. Markets with intrinsic demand, restricted future supply levels and infrastructure development will see maximum price advantage,” says Ahuja.

Micro markets in demand

This raises a fundamental question as to which are the locations that hold more potential. Experts believe any locality is pre-dominantly governed by the infrastructure, demographics, proximity to main highways, railway stations & schools shall alternately command better appreciation.

Developers are also getting smart to identify the potential and are launching projects near the upcoming infrastructure developments like metros and monorail projects. The upcoming Phase-II of Mumbai Metro involving the stretch of Dahisar-Charkop-Bandra-Mankhurd is one such infrastructure development been looked upon. The project has in particular brought a demand leap in the nearby regions like Oshiwara.

The price trend in Mumbai clearly indicates that infrastructure projects located around Sion, Jogeshwari and Oshiwara seem to be altering the real estate landscape in many ways.

In Central Mumbai locations Ghatkopar, Powai and Vikhroli have already been witness to more than average appreciation due to better connectivity and upcoming commercial parks. Other micro pockets which might see price appreciation include locations near proposed metro corridor on Western Express Highway, Mulund, and Dadar in South – Central Mumbai belt.

The property markets in areas such as Thane, Panvel, Dombivili etc. continue to remain the top investment destinations in Mumbai. With improving connectivity, government’s efforts to push stalled projects and increase in corporate interest in these areas, there is likely to be an uplift in residential market sentiment along with an improvement in social viability of the region.

Also, Bandra continues to be a luxury residential hotspot in Mumbai. The area remains a preferred destination for prime property seekers because of its elite profile more options for shopping and higher recreation facilities; thus attracting price appreciation.

Infrastructure calling card

With the JVLR freeway offering connectivity to areas like Bandra and South Mumbai, Western Suburbs such as Oshiwara are fast developing into a good investment option for people who are seeking to draw out maximum potential out of a property. Projects like the elevated road on Thane- Ghodbunder Road are also expected to change the real estate market dynamics.

The final nod for the International Airport at Panvel and proposed SEZs at Dronagiri, Ulwe and Kalamboli will give impetus to the property market in surrounding areas which are now expected to witness growth. Both these developments will give fillip to commercial and residential market in the adjoining areas. While property rates in main Mumbai are no longer within the reach of those who are looking for homes at affordable price, Navi Mumbai has shown an impressive growth with residential housing which are within the budget.

Lodha Group launches Amāra in Mumbai

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Bottom Line: The project is a neighbourhood in Prime Central Thane, built on principles of new urbanism within a large natural green cover and a thriving eco system.

Lodha Amara, Lodha Group, Akshay Kumar and Twinkle Khanna brand ambassadors of Lodha Group Amara, Mumbai real estate news, Indian real estate news, India property market, NRI investment, Track2RealtyLodha Group has launched Amāra – a utopian neighbourhood in Prime Central Thane spread over 40 acres. The lush green landscape of Amāra comprises of smart sized 1, 2 and 3 bedroom residences housed in 27-30 storied elegant towers, and 85% of space left open.

On account of large open spaces, car free concept and 1000s of existing trees, the air quality in this neighbourhood (AQI of less than 75) is claimed to be far better than any other city in India (including Mumbai) and almost at par with leading cities like New York and London.

The name, Amāra is derived from the Sanskrit word ‘Amar’ meaning ‘eternal’ – the neighbourhood has been designed to meet the eternal desire of humans to have the choice to pursue what they desire and have maximum happiness and contentment.

During its pre-launch, Lodha Group witnessed an unprecedented sales of over 2000 homes worth INR 1600 crores and within the first weekend of launch, another 300 units have been sold. These sales are record-breaking and reflective of the strong demand for high quality housing in the Mumbai region.

In great cities around the world, urban living is witnessing a unique and differentiated residential experience – neighbourhoods built on principles of new urbanism that promote an environmentally conscious life amidst a green cover, yet located in the heart of a city. To drive this new urban transformation in Mumbai, Lodha Group has brought together the finest internationally acclaimed partners, Padma Bhushan Hafeez Contractor and award-winning Singapore based landscape design firm Sitetectonix, who will create a masterpiece in landscape architecture and urban design at Amāra.

Akshay Kumar said, “Amāra is a unique urban concept, as par with master planned neighbourhoods of leading cities around the world. It’s like coming home to a world where every moment is rich, fulfilling and meaningful. It’s extremely rare to find such a haven in the middle of a city. This neighbourhood will enable its residents to live more, do more. I am delighted to be associated with Lodha Group on this new and innovative project, because it’s so refreshing to find such a forward looking developer that chose to build a society in a city without harming any nature. Instead of building a concrete jungle, Lodha has brought to us a luxurious nature filled neighbourhood fit for anything…What more could a family wish for than a nature linked lifestyle with the city at ones feet… Amāra simply lets you Do More, Live More.”

On being asked how Amāra falls into the evolution of Mumbai as a megapolis, Twinkle Khanna added, “This city has been growing at a very rapid pace and it is always nice to see lifestyles that allow you to stop and smell the proverbial roses. Time to reflect and spaces that allow you to do so are both a need and a great luxury. Every day in this neighbourhood, you have the opportunity to relax and re-energise. Amāra is a big step in that direction.”

Unveiling Amāra, Prashant Bindal, Chief Sales Officer (CSO), Lodha Group, said: “Over the years, Thane as a location has grown tremendously to create its mark today and it has become a booming commercial and residential hub due to the influx of business centers and other key developments. The robust demand generated by this neighbourhood, is proof that there will be a mass exodus of employable populace to Thane in the coming years. Moreover, branded urban neighborhoods are a rare phenomenon in Mumbai, and a lush and verdant neighborhood is even rarer in the city. In this backdrop, Amāra has received an encouraging response in the pre-launch stage with over 3000 booking applications. This neighbourhood has not only created super normal demand in a highly competitive market such as Thane but also revived its real estate landscape by reinforcing people’s trust towards appreciation and investment in real estate.”

Project Highlights:

A neighborhood amidst the greens designed by landscape specialists Sitetectonix, Singapore

1, 2 & 3 bed residences along with a bouquet of Jodi options to suit a variety of consumer preferences

Dedicated 25 acres of open land to sports and recreation, 1000s of trees resulting air quality, which is much better than any other place in India and in line with air quality in great cities like New York and London.

A mega clubhouse and five cluster clubhouses spread over 25,000 sq. ft.

World-class amenities at clubhouses like multi swimming pools, a 5,000 sq. ft. gymnasium, indoor multi game arena, a 100 seater auditorium and a party hall

A grand sport terrace with world-class sport facilities such as international standard football ground, tennis courts, basket ball courts etc.

400m athletic track, tennis court and basketball court with night play facility

Excellent connectivity with all parts of Mumbai surrounded by some of the best malls, schools and hospitals in the vicinity

DP confusion responsible for less launches in Mumbai

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The new launches have drastically slowed down in Mumbai due to confusion with Development Plan.

Mumbai City, Mumbai property market, Indian real estate news, Indian property market, NRI investment in Mumbai, Track2RealtyA perception has gained ground that the less launches are due to slow sales, liquidity crunch of the developers and other market realities. Though these reasons cannot be ruled out behind some setbacks, the Mumbai real estate has been in a wait & watch mode for quite some time for another significant reason – confusion with the new DP (Development Plan).

It has, as a matter of fact, affected the new launches in the city more than any other factor. The developers do not wish to launch a project now and within a few months find themselves in a position where they have to rush to the Brihanmumbai Municipal Corporation (BMC) for further changes.

The BMC is expected to release its revised Development Plan by February 2016. Last year, the draft DP led to confusion in the market where both the developers as well as the citizens pointed out glaring errors, leading to the removal of then Municipal Commissioner. There were about 8500 suggestions and objections to the draft DP. The developers also maintain that this led to the delay in many new launches.

Dhaval Ajmera, Director, Ajmera Realty & Infra points out that the confusion that has happened with the proposed DP is the primary reason for the slowing down of the new launches in the past one year in Mumbai. The DP is now being rectified, as there have been confusions, wrong reservations that have been filed. Probably certain places that were early declared as residential area are now been under another reservation where the developer cannot launch the project as it is wrongly demarcated. Hence, until the reservation is cleared, launches have had to take a backseat.

“There are instances where property declared as a completely residential zone is now partly claimed under the reservations. Hence, if the developer has planned a project in a certain area, it is affected due to the partial reservations  impacting the launch of the complete project to go on a hold. This definitely affects the developer majorly keeping in mind that the finances are stuck. Keeping in mind the confusion in the draft development plan, it is taking long to solve and we hope to get it resolved probably by May this year,” says Ajmera.

Parth Mehta, Managing Director, Paradigm Realty maintains that where land has been already acquired or development rights has been already obtained there the developers are left with no choice but to go ahead with prevailing DCR (Development Control Regulations) and commence their construction but provisions for extra FSI can always be kept in planning provisions.

“Where developers who are looking at potential new acquisition currently there is a wait and watch scenario with reference to permissible FSI and new approval policy. Where developer has received complete approval and where construction activity is visible at the site there indeed sales are still happening, may not be at a very high velocity but apartments in projects by credible developers with a delivery track record are selling backed by complete approvals in place, home loans facility tie up with banks and subvention schemes offered by banks and institutions,” says Mehta.

Vipul Shah, Managing Director, Parinee Group, on the contrary, believes that the developers are going ahead with their existing developments plan as the new DP has taken a lot of time. However, because of the delay there is a lot of confusion in the industry. This should have been avoided. So the sooner the new DP is released, it would bring clarity to benefit both the real estate industry and the consumer.

“The old DP and the expected new DP has taken a long time and still not sure, which in turn has created a huge confusion in the Industry resulting in imbalance of the realty eco system. Initially the sales were a bit slow but buyers are waiting to buy the right project as we have seen in case of few new launches proving the market is looking up,” says Shah.

The developers demand that the new DP will indeed have to be released keeping in mind no area specific FSI imbalance. There will have to be a balanced distribution of FSI to ensure optimum supply of new inventory in locations, whereby there will not be very highly skewed pricing imbalance.

This also raises a fundamental question as to what extent slow sales have affected the new launches and to what extent the DP confusion has been the catalyst. Most of the analysts tracking Mumbai property market agree that the liquidity crunch, uncertain job scenario, lack of visible parameters for business growth have kept people on wait & watch mode.

As far as homebuyers are concerned, there is a general belief that the confusion has also affected the home buying decision of prospective buyers as many of them are so well informed that they anticipate significant price correction once new DP is implemented.

Developers nevertheless maintain that the price correction has already been factored in today’s prices backed by eased out payment plans . Hence, prices going below this points will not be a viable proposition for the developers considering high input cost. But the new launches have been definitely affected as the developers are in dilemma whether to wait for new DP or go ahead with current DCR. The developers hence demand that the new DP should be in sync with the government’s loud claims of facilitating ‘ease of doing business’.

Homebuyers looking to western suburbs this festive season

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Western Suburbs of Mumbai, Mumbai property market, Property in western suburbs of Mumbai, Indian real estate market, India property market, Indian realty news, India real estate news portal, Indian real estate website, Track2Media Research, Track2Realty, NRI investment in Indian propertyWhen Roshan Abbas, a property broker operating out of Mira Road of Western Suburb, claimed that the region would be the catalyst of housing revival in the Mumbai Metropolitan Region (MMR), many thought this to be claims of a broker glorifying his catchment area. Some of the critics even dismissed it as another marketing stunt on the eve of the festive season of Navratra.

A closer look, however, confirms that the take of this property dealer has been firmly grounded with realities. Some research and bird’s eye view on the property landscape of the city would suggest that no other region has as much potential at this point of time as the property markets of Western Suburbs, both prime localities as well as the extended zones of the Western Suburbs.

The point is what makes Western Suburbs the investment magnet. Analysts point out that this suburb has got something for each and every segment of the buyers. If the region is home to some of the costliest properties of Mumbai in Bandra selling over Rs. 50,000 per sq feet, then there are most affordable properties like Virar selling at Rs. 4,000 per sq feet. In between there is something for each and every aspiration to own a house.

On this festive season, the icing on the cake for the property buyers is what could be conveniently termed as triple comfort. This is how Swati Prasad describes it when she talks about the better macro-economic outlook, attractive price point and better purchasing power of the homebuyers. According to her, this festive season is much better than the last four years when even those who could afford were pretty apprehensive to make a long commitment like a home purchase.

“With political stability there is better clarity of the way forward for the country which is clearly reflecting in the macro-economic outlook. Personally, I have been on a house hunt in the MMR region and today I can vouchsafe that price point is indeed attractive in many of the markets of Western Suburbs. There is better job stability in sight and that is leading to average working class like me to buy a house. Of course, what better time than on the occasion of Navratra,” says Swati.

Swati is not alone who feels comfort to buy a house in the festive season of Navratra. As a matter of fact, advertising professional Sumedh Varma finds even better reason to buy a house in the Western Suburbs now. He maintains that the Reserve bank of India has also encouraged property purchase this festive season with significant rate cut. More importantly, he maintains that the role of the developers also cannot be undermined, as they are increasingly understanding the wants and needs of the customers and customising their offerings.

“Gone are the days of unwanted freebies and symbolic discounts; today many of the developers in this region are sitting across the table with the homebuyers to understand their point of view, concerns and needs; and they are accordingly customising the offers to suit their budget. This way I think the developers in the Western Suburbs have a better understanding of their core market, compared to other markets. I personally feel that the bookings on this Navratra will be way higher than what we have seen in recent times,” says Varma.

Most of the analysts active in the region agree with the homebuyers in this part of the world. They maintain that since many of the affordable buyers who came to the region as tenants and have been witness to the growth of the area are convinced that the future belongs to the region, they are ready to invest in the region.

Also, despite of the property market turmoil in the last few years, low-cost extended zones of Western Suburbs, like Mira Road, Bhayandar, Vasai, Virar, Nalla Sopara etc have either been witness to the decent growth of prices or have been stagnant, and hence there is less risk to invest in the region.

Moreover, the homebuyers in the Western Suburbs are mostly the working class expat population and they have found employment in the vicinity, this area continues to grow. The infrastructure growth in the region has fuelled the job market of the region; something that gives a facelift to the entire stretch of Western Suburbs. The festive season has only brought the pent-up demand to the fore due to multiple of factors, like the growing economy, lower inflation, interest rate cut, better job prospects and overall anticipation of growth in the future.

The developers on their part know that this is one region where there are land parcels yet available and also there is huge demand; they are also increasingly getting bullish on the region. With many of the large ticket developers operating in the suburbs now, it is quite obvious that the competition brings to the open market not only quality housing but also value addition to the homebuyers.

On the eve of the Navratra 2015, the analysts anticipate better property transactions in the Western Suburbs, compared to any other part of the city. Most of the developers also admit that the sale enquiry prior to the festive season has been four to five times more this year. This is quite striking and definitely suggests that the homebuyers this year will take a plunge. The days of fence sitting in the housing market seems to be over in this part of the world.

The moot point remains as to whether Western Suburbs will be witness to the revival of Mumbai property market. Homebuyers’ optimism suggests so, analysts vouch for it, and the sales enquiry indicates that. The cost & benefit analysis suggests there are more advantages to invest in the region and the festive season is the right time to do so.

Real estate being a business that is largely guided by the sentiments, it is not surprising that the sentiments are bullish to invest in Western Suburbs this festive season. More importantly, even the critics of Mumbai property market are not complaining as property markets of Western Suburbs bridges the gap between emotional urge and rational needs.