State approves Mumbai Development Plan 2034
After multiple revisions and alterations, the Mumbai Development Plan 2034 was finally approved by Maharashtra government. With a special focus on affordable homes and employment generation, the plan commits to create a million budget houses and eight million jobs in the city.
Over 10 lakh homes under affordable housing mission
The State government decided to construct 10 lakh affordable homes under Pradhan Mantri Awas Yojana (PMAY) on salt-pan lands in Malwani, Gorai, Jogeshwari and Mulund. Under the Development Plan 2034, these land parcels will be converted into residential areas, helping decongest the city, rationalising property prices and boosting affordable housing.
Mumbai Metro 2A construction work in full swing
The 2A project of Mumbai metro is going on with full gusto as nearly 50 percent of the piers have been established. The 18.6 km-long DN Nagar and Dahisar via Link Road route will have its first station at Kasturi Park in Malad. Set to be completed by 2019, the metro route is anticipated to ease commutation along the stretch.
Ready reckoner rates kept unchanged
Maintaining status quo in RR rates is expected to trigger residential demand in Mumbai and Pune. Revenue collection has also gone up this year, implying that demand is contained and any change in market dynamics could elicit a volatile reaction.
Freeway from Airoli to Kalyan set to enhance Thane’s transport grid
The Mumbai Metropolitan Region Development Authority (MMRDA) is set to develop a freeway from Airoli in Thane to Katai Naka in Kalyan at an approximate cost of Rs 950 crore. Estimated to be completed in three phases, the tenders for the project have already been floated.
Emulating the real estate sentiment prevalent in Delhi NCR and Bangalore, Mumbai too, entered the orbit of recovery in 2018. The Apr-Jun 2018 quarter witnessed end-users heading to localities boasting of surplus affordable properties and sturdy infrastructure. Almost 50 percent of the total demand was for properties priced within Rs 40 lakh. Not surprisingly, the residential pockets of Ulwe, New Panvel in Navi Mumbai and Kolshet, Karjat in Thane reported maximum enquiries.
Maharashtra government’s plan to develop 10 lakh affordable homes under PMAY on the salt-pan lands of Malwani, Gorai, Jogeshwari and Mulund augurs well for the future of Mumbai. Further, the expansion of the transport infrastructure – Mumbai Metro 2A, freeway from Airoli to Kalyan, Mulund-Goregaon link road and Dahisar East-Andheri metro corridors – is anticipated to transmute the city’s realty fortunes in the forthcoming quarters. An unsold inventory of 86,000 units, may however, prove a deterrent to the city's realty growth.
To propel sales volume, the State government has to ensure fast-paced infrastructure development, while being committed to the efficient implementation of MahaRERA. Further, bridging the demand-supply gap in the affordable housing bracket, especially in Navi Mumbai, holds the key to motivating long-time fence-sitters foray into the property market. Crystal gazers, however, believe that actual real estate growth can be tracked only after the festive quarter of Oct-Dec 2018.
Stringent action under MahaRERA played a major spoiler for the developer fraternity and slowed down real estate activity. Directives such as interest payment to homebuyers for delayed possession, and discontinuation of projects without proper approvals dwindled residential demand further.
North Mumbai localities continued to rule the roost, courtesy the large-scale infrastructure projects currently under progress. Residential launches in the last six months have boosted the attractiveness of Goregaon, Andheri, Jogeshwari and Virar, which were at the cynosure of major real estate activities.
Goregaon (West) and Andheri (East) clocked a three and two percent quarterly increment in capital values, respectively. Both the localities witnessed residential project launches by marquee names in the last one year. Rapid civic infrastructure development and proximity to commercial and retail establishments are other driving factors.
The prospering and price competitive markets of Navi Mumbai and Thane pulled demand away from Mumbai’s exorbitant central areas. The residential market in the city, thus, witnessed no change in average weighted property prices. The city also reeled under MahaRERA’s full-blown impact as developers were asked to register illegal properties with the regulatory body.
72 bridges, 21 flyovers, two overpasses, two rail over bridges, and 35 Vehicular Underpasses (VUP), among others.
Availability of land parcels for residential use and proposed metro rail connectivity boosted growth prospects of Kanjurmarg (East), which witnessed a marginal price rise, QoQ.
Average rental prices were up by three percent in the quarter ending June 2018, compared to the same period a year ago. Several localities in South Mumbai and Central Suburbs led the rental graph with a 9-10 percent increment in 'ask' rates, YoY.
Meanwhile, Borivali (East) and Chembur led the popularity index on the rental front, displaying a five and one percent annual increment. Average rents for a 1BHK in Borivali hover around Rs 22,000 per month, much lower than its counterparts such as Bandra and Andheri where 1BHK rental costs are between Rs 30,000 and Rs 45,000 per month.
Price-competitive inventory helped Chembur and Goregaon (East) garner robust demand in the rental market. These housing pockets also benefit from good connectivity via the metro line from Versova to Ghatkopar.
There is an evident shift in end-user demand from upmarket neighbourhoods in Navi Mumbai such as Palm Beach Road, Seawoods, and Vashi to affordable localities such as Ulwe, New Panvel and Khandeshwar. The latter regions chronicled a three to four percent increment in apartment values, QoQ.
The once-sleepy suburb of the twin city, Ulwe has gained real estate prominence owing to its closeness to the Navi Mumbai International Airport. Recording a four percent increment, the locality boasts of several RERA certified projects that have grabbed homebuyer interest.
Other nodes that garnered buyer demand include Panvel and Ghansoli. While Panvel primarily benefits from its proximity to Ulwe and metro connectivity at Kharghar, Ghansoli is growing on the back of the recently inaugurated Ghansoli-Talavli flyover.
Buyer interest had already begun to advance rapidly owing to the official launch of Navi Mumbai International Airport in the previous quarter. In Apr-Jun 2018, the market sentiment gained momentum, with localities situated within the 10-km radius of the airport reporting increased enquiries and transactions. Other demand propellers include lower cost of operations, speedy connectivity via JNPT Road, and setting up of IT hubs.
and expensive counterparts of Airoli and Belapur. Social infrastructure and connectivity to office hubs also work in favour of Kharghar.
The tenant community continued to move towards affordable belts such as Roadpali and Taloja in Navi Mumbai. Average rental prices moved up by five percent, YoY, in the zone, highlighting the increased preference towards leasing apartments in the last one year, given the volatility in the capital market.
Replacing Ulwe, Vashi emerged as the top performing rental market in Navi Mumbai this quarter. Availability of budgeted rental stock, proximity to malls and IT Parks acted as growth drivers.
Ghansoli and Panvel followed suit, with a seven and five percent increment, YoY. Rapid infrastructure developments and mushrooming of large-scale integrated townships by reputed players boosted rental prices here.
THANE AND BEYOND
Thane has earned the reputation of becoming the nucleus of real estate investments, courtesy low land rates and upcoming infrastructure plans. Some of the pivotal projects under development in Thane include Wadala-Thane Metro 4 corridor, and extended Mumbai Urban Infrastructure Project which includes construction of three creek bridges, two rail over bridges (ROB), and nine flyovers, among others.
Karjat led the capital graph with a four percent rise in prices, QoQ. Once popular as a second home destination, Karjat is now one of the fastest growing residential hubs of Thane. The presence of educational institutes, several reputed projects and the upcoming Panvel-Bhimashankar highway has enhanced consumer confidence, spelling good news for investors.
Kalyan and Dombivli’s coverage under Smart City project has proven to be a game changer for the residential growth of these localities. Initiatives such as decongesting Dombivli station, development plan report for the Station Area Traffic Management Scheme (SATIS) and Kalyan-Shil-Taloja metro are overhauling the status of these areas. Both Dombivli and Kalyan West reported a three percent increment in capital values, QoQ.
Thane reported the maximum sales of residential apartments across the MMR region in Apr-Jun 2018 vis-à-vis the previous quarter. With a marginal uptick in average capital ‘asks’, the region is poised to tread a growth trajectory starting Ganesh Chaturthi in September. The period marks the beginning of multiple discounts and new launches by the developer fraternity and is expected to see more buyers loosening their wallet strings.
Kolshet, too, featured as a top performer in the capital graph of Thane with a two percent increase in average weighted property values. Availability of land parcels and setting up of commercial projects has led to an increase in real estate activity in Kolshet.
Thane’s rental trend highlighted that localities hosting pocket-friendly rental options such as Kalyan (West) and Dombivli (East and West) were favoured more than the expensive counterparts such as Bevarly Park and Patlipada.
Infrastructure development along the Kalyan-Dombivli belt on the back of the Smart City project boded well for the rental scenario as well. While Kalyan (West) saw an increase to the tune of eight percent, Dombivli (East and West) recorded a four percent rise in rentals, YoY.
Availability of land, affordability and suitability for professionals working in the industrial belt of Ambernath-Badlapur were the primary growth drivers for Ambernath’s popularity among the tenant community. The locality chronicled six percent growth in rental prices YoY.
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