MOSL: REAL ESTATE-BROKER CHECK – A deep dive into MMR’s two micro markets
REAL ESTATE: BROKER CHECK – A deep dive into MMR’s two micro markets; Affordable modern on a strong footing; ‘Perceived luxury’ in distress
As part of our ‘REALiTY CHECK’ series, we met real estate brokers in two key micro markets of the Mumbai Metropolitan Region (MMR) to understand the underlying trends and nuances. We extensively covered (1) Central Mumbai, which is home to India’s most luxurious residential real estate projects, such as Lodha – The World Towers, Oberoi 360 West, Raheja – Imperia and Piramal Mahalaxmi and (2) Thane – the largest micro market in the MMR region, which boasts of an affordable modern lifestyle to the aspiring middle income group (MIG). Key highlights:
- The housing market is divided into two parts: (1) Need-based housing which comprises 1/2/3BHK flats ranging from 400sf to 1,500sf. (2) Luxury housing where units are sold at a high ticket size of INR50m-500m (or even higher).
- Need-based housing boasts of high velocity and comprises units that are compact in size, ready-to-move in or one-year to possession, have connectivity to commercial catchment and come with basic in-house amenities. Here, the risk of price crash appears negligible owing to good demand. A developer is likely to offer a discount of 10-15% on the rack rate.
- In central Mumbai, the luxury market is steady and developers have been able to maintain prices stable (although the velocity has slowed down) in projects where location, view and gentry are well maintained and units are vastu (science of architecture) compliant. However, there is distress in projects with a disconnect between the expectations and the price offered - we call it 'perceived luxury.' In such cases, prices have crashed by as much as 40% from the rack rate which is further pounded by re-sale inventory too.
- According to our channel checks, Oberoi, Raheja, Kalpataru, Hiranandani and Rustomjee are the top developers in the region.
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