By: Ravi Sinha
Track2Realty Exclusive: Knight Frank report says with demand likely to remain subdued as the market continues to bottom out in the backdrop of a sluggish economy, a more pronounced rationalisation of prices is warranted in 2013.
The pattern of new launches also substantiates the claims of Knight Frank. For instance, the core of the residential market has been steadily shifting northward of the Mumbai Metropolitan region over the years as the people are moving away from CBDs. An Estimate of 62% of the total units under construction are now concentrated in Thane, Navi Mumbai and the Peripheral Central and western suburbs compared to 57% in 2012. The peripheral and Central Suburbs saw a huge spur in launches as its market share jumped from 8% in 2011 to 15% in 2012.
The share of the peripheral suburbs has jumped from 21 per cent in 2011 to 28 per cent in 2012 and has led to a proportionate spurt in the number of units launched in the Rs 25 – 50 lakh bracket that has grown from 29 per cent to 36 per cent in 2012.
The central suburban corridor from Sion in the Central Suburbs up to Badlapur in the peripheral central suburbs saw the maximum launches in 2012 and consequently had the highest unsold inventory. About 35 per cent of launches in 2013 will be in these micro-markets, which is likely to put further pressure on unsold stock and prices there.
Further, the peripheral markets attract a lot of investor interest due to the lower ticket sizes and the promise of superior returns. Here, the investors’ segment has been seen offloading their holdings, adding a significant shadow supply in the market, the report added.
Softening of property prices in Mumbai and the market turning out to be buyers’ market has been a wishful thinking for over a decade. However, now that this has turned out to be a reality, the biggest question that every property buyer asks in Mumbai has already been answered—is this the right time to buy?
