Mumbai Real Estate Sees Rise in Demand for Affordable Homes Priced Under ₹30 Lakh
A study by Liases Foras shows a 41% growth in the less than ₹30 lakh housing segment in the March-June quarter, with bulk revival observed in peripheral areas of the Mumbai Metropolitan Region.
Mumbai Real EstateAffordable HousingLiases ForasMhadaPmayClssSuraksha GroupAnarock GroupKnight Frank IndiaReal Estate PuneAug 22, 2024
Bulk revival was observed in the peripheral areas of the Mumbai Metropolitan Region (MMR) including Vasai-Virar, Boisar, Titwala, Dombivli, Ambarnath, Palghar, and Panvel.
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Meanwhile, the island city continues to remain elusive to this segment, even though Maharashtra Housing and Area Development Board (MHADA) recently released home units priced below ₹45 lakh for sale for the lower-income group in Wadala, Kurla, Vikhroli, and Antop Hill.
Pankaj Kapoor, director, Liases Foras, said, “If this trend continues, we will soon see a ‘V’ shaped recovery in this segment, which has seen a steady decline in the last several quarters.”
The surge, he said, comes in the backdrop of budgetary announcements made by union finance minister Nirmala Sitharaman to resuscitate the sector.
Of the total 6,675 low-income units launched between March and June 2024, 2516 were in the north-east region, followed by 1807 units in the Palghar-Boisar region. Titwala east, despite being the smallest of the three, saw 964 new launches, the study said.
Quarterly sales saw a growth of 8%. Moreover, 84 new projects were launched between March and June by top local developers including Dream Homes, Vansh Developers, Avyu Buildcon Pvt Ltd, Sun Homes, and Saphale Land Developers LLP.
Jash Panchamia, partner, Suraksha Group, that is developing affordable housing in a sprawling 362-acre township in Vasai corroborated the study’s findings. He said in three months, between March and May, 2024, his company clocked 6,500 bookings in the Suraksha Smart City township under the Pradhan Mantri Awaz Yojana (PMAY).
This was the result of the government widening the scope of eligibility among the economically weaker sections -- from the previous annual income of ‘ ₹0 to ₹3 lakh’ to ‘ ₹0 to ₹6 lakh’. This drew a flood of buyers who could avail of bank loans to purchase the 30-sq mt units priced at approximately ₹22.5 lakh.
Kapoor added that revival of the credit linked subsidy scheme (CLSS) which was discontinued, has proved to be attractive for the low-income group of buyers both within the PMAY and the open market. It offers them a discount of nearly ₹2.70 lakh upfront in their EMIs and purchases, along with a flat ₹1000 stamp duty.
Local brokers in Vasai-Virar and Boisar-Palgar region feel affordable homes are not selling as expected as awareness of the scheme announced in the budget is still low.
Dr Ajay Dubey, president, Property Dealers Association in this micro market said, “Banks have yet to receive the GR notification or government funds, so the schemes are yet to take off in the open market.”
Dr Prashant Thakur, head of research, ANAROCK Group, on the other hand reasoned that the city is in the cusp of two extremes. On the one hand, affordable housing is gaining traction in the periphery catering to the unorganised sector, while on the other hand, “land parcels in the island city and close suburbs remain out of their reach to cater to this segment as they are expensive”.
Gulam Zia, senior executive director, Knight Frank India, added, once the infrastructure projects are up and running this segment will receive further boost. “With connectivity, people will not mind travelling from their homes in the outskirts of Mumbai to places of work in the island city and suburbs. Hence, the government must deliver on its infra promise by meeting timelines.”
Frequently Asked Questions
What is the current trend in Mumbai's real estate sector?
Mumbai's real estate sector is showing signs of recovery, particularly in the affordable housing segment.
What is the growth rate of the less than ₹30 lakh housing segment in the March-June quarter?
41%
Which areas have seen bulk revival in the Mumbai Metropolitan Region?
Vasai-Virar, Boisar, Titwala, Dombivli, Ambarnath, Palghar, and Panvel
What is the credit linked subsidy scheme (CLSS) and how does it benefit low-income buyers?
CLSS offers low-income buyers a discount of nearly ₹2.70 lakh upfront in their EMIs and purchases, along with a flat ₹1000 stamp duty.
What is the role of infrastructure projects in boosting the affordable housing segment?
Infrastructure projects will receive further boost once they are up and running, as people will not mind travelling from their homes in the outskirts of Mumbai to places of work in the island city and suburbs.
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