Mumbai is the most populous city in India, home to over 12.5 million people.
Demand for housing in this densely populated city is always strong, whether it’s for visiting tourists or people living here year-round. Mumbai is something of a Mecca for those seeking employment opportunities in the financial and entertainment sectors, and the city has retained a strong economy even in the face of political uncertainty. In fact, the economy grew by 4.7 per cent in Q3/2013, demonstrating resilience and supporting the fact that investing in property here is a smart choice. The demand will never cease for housing here, and property investors unafraid to contend with slightly higher prices can expect huge rates of appreciation from a property in Mumbai.
The enduring allure of Mumbai
That Mumbai managed to develop economically last year is a positive sign for property investors, and as the economy is expected to grow further towards the second half of the year, so too are the prices of residential real estate.
Developers are working to meet the demand for property in Mumbai, releasing an estimated 10,700 new units in Q1/2014. This is nearly double the amount of inventory released in the previous quarter, indicative of investor confidence in the market. The cost of property remains strong in Mumbai, with even new launches commanding a competitive price point. The capital values in central Mumbai have increased 3 per cent year-over-year, and were reported to be between Rs 8,000-11,000 as of Q1/2014.
Mumbai is well connected by public transit, and the infrastructure is already extensively developed. These and other factors have contributed to creating what some real estate analysts have dubbed an “evergreen lease market”, as the demand for rentals in the city is and has historically always been high. While there is still money to be made in capital appreciation, property investors can enjoy a steady flow of rental income during the holding period as well.
Prices show no sign of stagnating, making Mumbai a profitable buyer’s market. With plenty of new stock launching in 2014, now is a prime time for property investors to purchase units for which there is and will always be a strong demand.
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