Mumbai Property Prices Defy Expectations, Soaring 66% in Four Years
Mumbai, India's premier real estate destination, has consistently commanded high property valuations. Recent analyses reveal a staggering 66% surge in property rates over the past four years.
Property Rates in Mumbai still see new heights.
This upward trend has confounded industry experts who had foreseen a price correction. The current reality stands in stark contrast to their predictions. In a surprising turn of events, property rates in Mumbai have increased by a substantial 66%, as reported by the global real estate consultant firm, Jones Lang LaSalle India.
Sluggish home sales had led many to believe a market correction was imminent. Developers themselves acknowledged that a price adjustment might be necessary to invigorate the market.
Property rates still rise in Mumbai.
However, defying these expectations, residential property prices in Mumbai have continued their ascent, primarily driven by limited supply and land scarcity.
Ramesh Nair, MD of JLL West India, explains that a surplus of unsold inventory is typically a leading indicator of a price correction. Applying this principle to Mumbai's residential market, a correction, he argues, should have occurred at least three years prior.
"Always the unsold properties in any market are considered as a precursor of price correction," explains JLL West India’s MD Ramesh Nair. "He adds that if this is true related to the residential market of Mumbai, the correction should have taken place at least three years ago."
The last price correction Mumbai experienced was in 2008. Since then, the trajectory has been consistently upward. A comparison of property rates between the second quarter of 2009 and the second quarter of the current year reveals a 66% increase.
Furthermore, property rates in Thane and Navi Mumbai have witnessed even more dramatic increases, surging by 70% and 74% respectively. The report also highlights sustained investment demand in the residential sector over the years.