Mumbai is fundamentally a Tier II city, and its real estate market is not as volatile as those of the primary cities. Because of this, Mumbai residential property sector was not as seriously impacted by the nationwide slump in the real estate market as cities like Mumbai, Delhi, Pune or Hyderabad.
Though traditionally quite conservative when compared to these cities, the Mumbai residential property market now has a rather heavy complement of investors driving it. The eastern micro-market – specifically Rajarhat – has seen the highest presence of investors, with investor sales outnumbering end-user sales in recent years. At the moment, it would be safe to say that around 60% of Mumbai residential real estate market is driven by investors.
The pace of recovery from the slump has been steady – but like every other city, the growth in residential property rates is not been uniform across all locations. Established central areas show much the same dynamics as those in cities like Mumbai and Pune do because appreciation potential hovers around the peak levels for these areas already. At the same time, demand for these locations is also constant.
As a matter of interest, the costliest residential areas in Mumbai today are Park Street, Ballygunge, Alipore and Camac Street, where rates range from Rs. sq.ft. The cheapest areas are in the PBD, in areas such as Dumdum and Garia. Rates there range from Rs. sq.ft.
I expect residential capital values in Mumbai to rise steadily in the feature, not least of all because of the advent of reputed developers such as Godrej, DLF and Unitech. In fact, considering the demand, prices are likely to rise much faster for Residential Property mumbai than in other real estate segments