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Mumbai Real Estate Market Remains Lucrative Despite Challenges



Sanjay Daga

Mumbai, the land of opportunities, attracts professionals from afar. 

Migrants have made the city their home with aspirations in their eyes. Despite the challenges, Mumbai’s real estate market remains lucrative for individuals, corporates and the industry. 

In 2019 the real estate sector faced several challenges – liquidity crunch on account of non-availability of funds from NBFC’s, several projects went under corporate insolvency resolution process while some projects were delayed due to the approval process. The real estate sector is also reeling under the impact of GST and input tax credit which has resulted in high construction costs for the developers. 

On the positive side, the ongoing infrastructure projects and increased connectivity is creating demand for housing in Mumbai. Consumers are looking at buying homes in affordable neighbourhoods, leading to new project launches in Thane and Navi Mumbai area. 

A telling example of the correlation between connectivity and increased demand is area such as Dombivali. The upcoming projects such as the multi-modal corridor, Kalyan-Dombivali-Taloja Mumbai Metro and the Airoli-Katai elevated road have led growth in demand for housing in this city. The proximity to the commercial areas of Mhape, Airoli, Koparkhairane, and Ghansoli is further fuelling demand for residential buying in Dombivali and its surrounding areas. This belt has also seen rise in integrated townships. 

Similarly the metro connectivity between Ghatkopar and Versova has given a boost to the real estate market along this corridor. Chembur too is seeing emergence of many residential projects. 

The changing demography and evolving customers is also transforming the commercial real estate sector in Mumbai. Micro-markets such as Powai, Vikhroli, Kurla and Goregaon have been preferred investment destinations.

As we look forward to the New Year, demand for affordable housing is picking up in the city and suburbs. The redevelopment of cess buildings and societies is expected to gain momentum, making way for affordable housing projects. 2020 shall also be the year of technology adoption for the real estate sector as marketing technology enhances the customer experience. 

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