An Overview of the Current Property Market Scenario in Mumbai

Equity markets have witnessed great volatility through the last few months of the calendar year 2022 and early 2023. With fears of a looming recession, extreme weather conditions, and a prolonged Russia-Ukraine war uncertain the immediate future, investors are looking towards more predictable and stable investment options. With gold prices reaching an all-time high, real estate seems to be the obvious choice.

The real estate boom in India following the post-pandemic and reopening of the economy has been more salient in major cities like Delhi and Mumbai. Despite a rise in interest rates and a slowdown in the property markets of Tier 2 and Tier 3 cities, real estate sales in Mumbai have witnessed unprecedented growth. Over 1.2 lakh properties were registered in the commercial capital in 2022. This is a 70% increase over real estate registration figures in 2018 or 2019. In the month of February 2023 alone, there were nearly 9,268 property registrations in Mumbai. This was nearly double pre-pandemic figures when 5,927 properties were registered in the city in February 2020. The pent-up inventory of top developers that had remained unsold due to the pandemic and economic slowdown seems to have been cleared, and construction activity has once again taken off.

Expansion of the suburbs

Both commercial and residential real estate sales in the suburbs of Mumbai have shown a marked uptick. SoBo, or South Bombay, has been the traditional hotspot for residential real estate development, but over the past few years, we have witnessed unprecedented growth in other parts such as Chembur, Goregaon, Mulund, Sewri, and Borivali. The expansion of the Brihanmumbai Municipal Corporation (Municipal Corporation of Greater Mumbai) is premised on the city's growing population and its increasing need for housing. Corporations, business enterprises, and government offices are moving to the suburbs and with this, the workforce is keen to find housing with shorter commute times.

Infra-powered growth

Infrastructure and development are the key drivers of real estate sales in any city, and Mumbai is no exception. The upcoming Navi Mumbai airport and the funds pumped into developing Navi Mumbai as a satellite city seem to have paid off. The Mumbai Trans Harbour Link, the longest sea bridge in the country, will reduce commute time between Mumbai and Navi Mumbai to minutes. This, in turn, has given a tremendous boost to real estate sales in Sewri and Navi Mumbai.
The expansion of the Mumbai Metro network will significantly aid the growth of the city's limits and offer the real estate sector a great deal of support. Lines 6 (Swami Samarth Nagar-Vikhroli), Line 7A (Andheri E - CSI Airport), and Line 9 (Dahisar-Mira Bhayander) are among those under construction, while work is yet to commence on Line 10 (Gaimukh-Shivaji Chowk), Line 11 (Wadala-CST), Line 12 (Kalyan-Taloja), Line 13 (Shivaji Chowk-Virar) and others.

Changing needs and trends

Real estate sector experts believe 2023 may be the year that witnesses a slowdown in sales in the affordable housing segment and a simultaneous rise in the premium and luxury residential market. And this trend is ringing true in nearly all parts of the city. The past year has been good for developers who have adopted eco-friendly construction practices and taken up green homes. The demand for a sustainable lifestyle is clearly evident among homebuyers in Mumbai. This is another reason why suburbs like Goregaon are becoming increasingly popular. The availability of space – something central localities in Mumbai are woefully short on – is a winning proposition. And so is the proximity of the Sanjay Gandhi National Park, often referred to as the "lungs of Mumbai".

Technology for the win

The real estate sector of India has been relatively slow to adopt technology and innovation. However, Mumbai seems to be leading the way in this respect. Apart from the top-tier developers and builders of the city, more midsized construction companies have started to discover the benefits of proptech tools and applications. The average homebuyer is also looking for revolutionary online platforms like Blox to bring projects that suit their needs and criteria. Blox used cutting-edge technologies to help make the homebuying journey a smooth and joyful experience.

Mumbai is scripting an impressive real estate growth story. There is a silent but steady transformation of the sector and a push towards adopting bigger, better, more innovative technologies. Like all major metro cities of the world, infrastructural development and connectivity are the key drivers of this real estate boost, but much of it also comes from the average Mumbaikar's drive to own properties – both residential and commercial. With the other investment avenues faltering, 2023 may be the beginning of the investor's return to real estate. Hence, one can expect the realty industry in Mumbai to develop exciting projects in the pipeline in the coming years.