There is both good and bad news for Mumbai real estate buyers. Those expecting a correction in the Mumbai real estate market will unfortunately have to shell out more during Diwali. But the good news is that real estate prices in central Mumbai may slip further because of oversupply and confused government policies.

BKC rules the realty roost
According to Jones Lang LaSalle, Bandra (East) and Bandra-Kurla Complex (BKC) is generating considerable interest among buyers and investors. BKC has seen over 3 million sq ft of office space absorption over the past one year. There is an immediate demand of an additional 4 million sq ft of Grade A office space, which will also result in an increased demand for Mumbai residential properties.

Sanjay Dutta, CEO of business, Jones Lang LaSalle, India said:“It indicates that residential properties in Bandra (East) are likely to see significant appreciation. Signature Island, a high-end luxury residential development at BKC, already commands a price in excess of Rs40,000 per sq ft,”.

Oversupply to hit Central Mumbai
Meanwhile, there is an oversupply of residential and commercial properties at Lower Parel, Parel, Mahalaxmi, Worli and Prabhadevi in central Mumbai. “And, many under-construction projects will be completed shortly. Few of them were stuck due to lack of clarity on government policies and public parking, FSI, developmental control (DC) regulation guidelines etc. Nothing is clear at this juncture. Everybody is confused and it is leading to chaos,” said a real estate expert.

Prices for under-construction projects under pressure to fall
Most of the projects in these areas are structures consisting of 40-85 storeys and exceeding 280m. Such structures require environmental and aviation ministry clearances. High construction costs and a prolonged construction cycle make matters more complicated. “As a consequence, prices for under-construction projects in central Mumbai are now under pressure to fall,” said Dutta.

Indian investors and homebuyers are sitting out the Indian property market according to industry experts. Indian home registrations are down 30-35 percent in Mumbai compared with last year.

Dampener for residential property in Mumbai
“Rapid rise in property rates in Mumbai have acted as a dampener for residential demand in the city, primarily in the premium and mid-high income segment,” Jones Lang La Salle said in a report.

Mumbai property developers and home sellers hurting
The recent slowdown in activity in the residential space is hurting both Mumbai property developers and home sellers. “I have a 2-bedroom apartment in central Mumbai, it’s a very nice building with a garden and a gym. I put it on the market 3 months ago and haven’t received a single inquiry,” Rajesh Jogani, a Mumbai-based real estate investor, said.

Mumbai property prices are expected to fall by 15%
The bad news for investors is that transaction volumes are unlikely to recover in the coming months because of the lack of affordable housing and rising lending rates and Mumbai property prices are expected to fall by 15% by end of 2011.

Investors looking to sell property in Mumbai
At Navyroof.com we have seen increased enquiries from people wishing to advertise and sell property in Mumbai online. Many investors wish to bank gains having bought before the height on the boom. We would advise anyone who wishes to sell Mumbai property fast, should offer it at a competitive rates or risk being left behind as prices fall.

How do I advertise sell property in Mumbai or India online?
To advertise and sell property in Mumbai or India online with Navyroof.com is simple, free (basic listing) and easy!

Upload your property information and add as many photos and video to gain an edge over other sellers. Indian property buyers are much more likely to view properties which they can see more of from the advert compared to those that have none. Once live on the site you can attract global Indian buyers not just those in India and sell with no commission charges, saving you money.

Destination development and infrastructure development are joined at the hip in Mumbai according to Jones Lang La Salle India.

Property destination must provide
A destination has to provide accessibility, open spaces and social conveniences such as shopping facilities, schools and hospitals for investors, who also want to sell the Mumbai property long term also.

So where should Indian’s and NRI buyers look to buy property in Mumbai?

Buying property in Powai
Powai stands out as a clear candidate for excellent destination development location because the Jogeshwari Vikhroli Link Road offers good connectivity between the western and central suburbs. It is one the prime examples of destination development projects in the country, which has been positioned with the right mix of asset classes, fabulous architecture and the vision of a developer.

Mumbai’s western suburbs very attractive
In terms of accessibility, the Western Express Highway, S. V. Road and Linking Road along the western line have made Mumbai’s western suburbs very attractive to upper mid-income homebuyers who are seeking a better lifestyle. In fact, the direct road connectivity offered by the Western Express Highway has caused Thane’s Ghodbunder Road to emerge as an extended western suburban destination.

Malad and Goregoan property
In the Western Suburbs, Malad and Goregoan property locations have been the examples of destination development in the past where developers like Raheja and Oberoi have created a cluster of excellent commercial office, retail and residential projects in Mumbai.

Versova-Andheri-Ghatkopar Metro
Versova-Andheri-Ghatkopar Metro will make locations along its route very lucrative for both commercial and residential space developers.

Property in Navi Mumbai and Kalyan-Dombivali real estate
Navi Mumbai and Kalyan-Dombivali real estate is also going to hit some new high notes with the coming of the new International airport.

The highest focus will be on Panvel and its immediately adjoining areas, since Panvel is Navi Mumbai’s last node and also the ingress for the Mumbai-Pune Expressway. A speedier focus on the development of physical and social infrastructure in the region will ensure that this region maintains its attractiveness as a destination on the Mumbai real estate map.

Slow sales and a glut of properties are set to hamper the residential property market in Mumbai, India, and prices could fall by a further 30% according to analysts.

The glut is likely to extend into 2012/13 as steady streams of new Mumbai developments are launched on the market, according to real estate consultants Jones Lang LaSalle. Developers who bought land at high prices are now having to bring prices down.

‘The overall sentiments of the market and the consistent rate of new project launches in Mumbai give a clear indication of an impending oversupply by 2012. A lot of developers in the most severely affected locations are currently open to closing sales at lower rates,’ said a note by JLL.

Sanjay Dutt, Chief Executive Officer – Business at Jones Lang LaSalle India said that of the total recent residential sales about 65% of flats in Delhi and 35% in Mumbai have gone to speculators. These flats are also expected to roll back into the market.

sell Indian properties

Mumbai commercial real estate is bouncing back after a prolonged recession-induced slump. According to Knight Frank, the commercial property market in Mumbai is showing signs of revival and enquiries are on the rise.

More Mumbai real estate transactions
The first three quarters of financial year 2010-11 witnessed more transaction of office space at 6.83 million sq ft than the entire last fiscal, which saw only 6.68 million sq ft uptake of commercial realty space.

Commercial rentals have started stabilising
“The postponement of expansion plans by many BFSI (Banking, Financial Services and Insurance) and IT/ITES companies, which are the principal drivers for commercial office demand in Mumbai further, affected the overall office market,” says the report. It is only recently that commercial rentals have started stabilising after nose-diving from July 2009 to December 2010 due to a feeble demand for the excess supply.

Pockets in Mumbai have shown an improvement in absorption by the BFSI and IT/ITES sector, which accounted for more than 60 per cent of the transactions for the last two years.

Mumbai real estate: The Mumbai Metropolitan Region Development Authority is contemplating the option of loan funding Metro Line-3 which extends from Colaba to Bandra from Japanese International Cooperation Agency.

Metro Line – 3 is Rs 12,000 crore
The total cost of the Metro Line – 3 is Rs 12,000 crore as per 2010 prices.The 20-km long corridor will now be based on the Delhi Metro Model, in which GOI will fund 19% equity and GOM/MMRDA will fund 21%. The rest 60% would be loan from JICA.

This is expected to have a vert positive impact on Mumbai real estate values.

American real estate giant Donald Trump is all set to enter the Indian property market with his signature project, Trump Towers, to be constructed on the plush Hughes Road in Mumbai.

Trump has tied up with Indian real estate firm Rohan Lifescapes to build the 65-storey tower, which would be formally launched when Trump visits India in the coming months.

There would be 45 spacious apartments in the building.The 3,00,000-square-foot project would have a luxury spa, gymnasium and also a mini-theatre along with a hi-tech security system.

View real estate and apartments in Mumbai

Property advisors and researchers say Mumbai residential property sales are slipping in the commercial capital due to high rates. With inventories piling up they expect to see a correction soon.

Mumbai real estate rates to fall 10% +
Residential property rates in Mumbai should correct by 10%-may be even more-in the next few months, according to property experts, who are seeing demand slipping because of unaffordable prices. But the situation in the National Capital Region and the southern cities of Bengaluru and Chennai is quite different with sales showing an upward trend.

Mumbai property sales have fallen 40%
Sales of residential properties in Mumbai have fallen by 40% since the peak in May 2009, says Edelweiss Securities, mainly due to higher prices which have increased by 15%-20% over the past six months. Now, Edelweiss researchers say that while certain projects might see an uptick in sales, overall volumes are likely to remain subdued, for, even as there have been several new launches this festival season there have been few takers. With inventory levels piling up, they expect rates to fall back to the levels in April 2010.

Jones Lang LaSalle India: 7-15%
Jones Lang LaSalle India, the global real estate services provider, thinks the correction in Mumbai will be seen only in some areas. “Certain areas in the south Mumbai, Bandra (West), Lower Parel and Mahalakshmi would see some corrections in residential property prices as the market is stagnant in the wake of low demand, lack of new supply and high prices,” a spokesperson from Jones Lang LaSalle India says. “It’s difficult to comment of the percentage of correction because it depends on the area. But I think it could be between 7% and 15%, not more. If prices fall by more than 15% people will start buying properties again.”

Property in India’s financial capital Mumbai is among the most expensive in the world.

But the high demand for housing and homes in India is coming at a cost to the poor according to Prerna Suri. She reports Families of Dharavi slum are being evicted to make way for billion-dollar apartment and real estate developments in Mumbai.

High Mumbai real estate prices, can’t be sustained for long and already sales are beginning to slow. Is the Mumbai real estate bubble about to burst or is there more growth?

To give you a more informed view here are the views from Navyroof.com and some leading property consultants in India.

View from Navyroof.com
Overall we feel Mumbai real estate needs to slow as prices are unsustainable in the medium term. If some heat is not taken out of the Mumbai market soon with “a soft landing”, we could see a large Mumbai real estate correction. With a large amount of speculation and high cost of land, prices up over 50% since January. Anyone who has made these quick gains would be well advised to bank them now as this rally cannot continue for much longer at this rate without those investors last to the party getting burnt first.

View from HDFC Securities
“We estimate the current unsold inventory of residential property in five major cities at 250 million square feet. The absorption of m Mumbai residential space in key cities has dropped in the last couple of quarters,” Llyod Cardoza, analyst with HDFC Securities, wrote in a note to clients last week. “According to our analysis, this is due to seasonal effect and possibly the run-up in residential rates.”

View from Jones Lang LaSalle India
Sanjay Dutt, CEO of Business, Jones Lang LaSalle India, wrote in a note: “There is yet another reason for the concern over a bubble building. All developers who had ventured to buy land overseas or across India are now buying only in their primary cities. Mumbai developers are concentrating on acquiring land solely in Mumbai, and the same is happening in Gurgaon.
“Investments are now chasing these tier one markets — and if this continues, there is certainly the probability of a bubble in Indian residential property by the end of the year.”

View from DTZ International
Ambar Maheshwari, head, investment advisory, DTZ International Property Advisers, said residential prices have gone to levels that are unsustainable. “Bulk level housing and commercial projects that were launched in the higher range are not getting enough clients at that pricing.There is a lot of euphoria at this point with the markets doing well, but there has been a huge increase in prices and there will be a correction pretty soon; the driver could be anything from a double dip in the US or a European economy not faring well. Even registration numbers at present are less than what they were at the beginning of the year.”

View from Cushman and Wakefield
Akshay Kulkarni, executive director of Cushman and Wakefield, concurred. “We do not expect a drop in prices. Even if we believe that sales are investor-led, they are coming in because they see value here.”Some developers say land prices are to blame for the predicament.

Whats your view? please post below