Office space deals drop more than two-thirds in Mumbai
It’s not just the residential real estate market in Mumbai that is going through a slump, the commercial office segment, too, is reeling under a slowdown.
It’s not just the residential real estate market in Mumbai that is going through a slump, the commercial office segment, too, is reeling under a slowdown.
It has always been axiomatic that when financial institutions raise their lending rates, there are bound to be ripples on the highly cost-sensitive Indian real estate market.
The property market in many Indian cities sees increased activity during festivals like Akshaya Tritiya, which are believed to be auspicious for the creation of wealth and good fortune.
After recording significant leasing in 4Q10, Mumbai city witnessed moderate transaction activity in 1Q11 as the major office occupiers of India Inc awaited the impact of budget on their corporate real estate strategy for the next fiscal year.
The period ending 1Q11 witnessed moderate activity in the office market in the city. With CBD vacancy rates continuing to hover at around 1%, office transactions were limited to either small office queries or larger office spaces that were inevitably a churn in the existing stock.
The Sensex has always been a barometer of the country’s general economic ‘mood’. The real estate index, on the other hand, is an indicator of the sentiments towards real estate developers.
According to the 2010 census, Mumbai now houses around 14 million people, which makes it India’s most populous city and the world’s second-most populous city.
After a one-year period starting 3Q 2009, which saw a strong recovery with a record 40%+ increase in prices, the Mumbai residential real estate market has been seeing a slowdown over the last two quarters across various micro markets.
The vision of owning a house is slowly getting clearer for buyers as residential real estate prices are beginning to see the promised correction on the back of hardening interest rates and poor transaction volumes.
The Finance Minister seems to be getting more appreciation than brickbats for renewing focus on the housing needs of Aam Aadmi. Even the real estate sector is divided and while the long awaited demands have not been fulfilled, a section of the realtors with affordable housing projects have appreciated the efforts.