Premium projects continue to keep the citys real estate market unaffordable, according to a recent Knight Frank report. Mumbai remains highly unaffordable real estate market compared to major cities such as Hyderabad and Bangalore, the report said.
According to the real estate consulting firm Knight Frank, the weighted average price in Mumbai city is high at 14,400 per sq ft as on quarter ending June 2013-14, while the weighted average price is about Rs 5,900 per sq ft for the entire Mumbai Metropolitan Region (MMR), which also includes areas such as Thane, Navi Mumbai, Mira-Bhayandar and Vasai-Virar.
A previous report by real estate firm Liases Foras had pointed out that the weighted average price of the unsold inventory during the previous quarter (January -March) in MMR between January and March had come to Rs 11,626 per sq ft.
Incessant price rise and higher concentration of premium projects with a ticket size of more than Rs 1 crore in new launches have limited the purchasing ability of home buyers, according to the Knight Frank report.
With 29 per cent of the citys total under-construction units surpassing the Rs 1-crore mark, compared to 11 per cent in the National Capital Region and five per cent in Bangalore, Mumbai remains unaffordable market, the report states.
Real estate giants such as Lodha Developers and Godrej Properties have recently come up with premium projects across the city.
Peripheral locations such as Vasai, Virar, Mira Road, Ghodbunder Road and Panvel witnessed a slew of launches during the last year. However, despite the waning interest of home buyers, quoted prices in Mumbai continue to remain high as developers are increasingly offloading their unsold inventory at a discount to investors who are willing to make substantial upfront payment, the report stated.