The report also mentions a significant drop of 7 per cent in average prices of residential properties, while commercial spaces saw a marginal rise of 1.7 per cent.
Mumbai saw 74,363 new housing units being launched in the year 2018, a growth of 220 per cent over 2017. Housing sales, however, witnessed a growth of only 3 per cent over 2017. These statistics were revealed in a report released by international property consultants Knight Frank. The report also mentions a significant drop of 7 per cent in average prices of residential properties, while commercial spaces saw a marginal rise of 1.7 per cent.
The two aspects of the report — reduction of prices and increased affordability — could be linked to each other, experts have said. The increase in the number of flats is attributed to release of supply that was previously held back due to regulatory aspects. The temporary reprieve from the construction ban due to the dumping ground issue in Mumbai was also a significant catalyst driving growth.
Furthermore, demonetisation's hangover coupled with structural changes like GST and RERA had led to a decadal low for new launches in 2017. As the dust settled on these issues, supply volumes rose again in 2018.
Housing expert Dr Sanjay Chaturvedi said 2018 wasn't a good year for the city's real estate sector, and predicted 2019 will be the same.
Shishir Baijal, chairman and managing director of Knight Frank India, however, said homebuyers are getting value for their purchase now. "Average prices have come down. Commercial office transactions have witnessed a growth of 5.4 per cent year on year in 2018. Limited supply helped keep rental values buoyant in 2018. Prime markets like BKC and central Mumbai recorded very low vacancies, leading to other regions benefitting," Baijal said.
Supply of office space in Mumbai for 2018 was 6.5 million sq.ft, denoting a 37 per cent decline from 2017. However, the average rental values for the office market in Mumbai was Rs 117 per sq.ft per month, a marginal uptick of 1.7 per cent.
A READY RECKONER TO REAL ESTATE
- 74,363 Number of units launched in 2018
- 63,893 Number of units sold in 2018
- 25% Average decline in size of houses
- 6.8%: Average decline in price of units
- 5.4% Growth in commercial leasing activity over 2018
- 7.9 mn sq.ft Leasing activities over 2018
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