Mumbai’s prime residential market maintains momentum

Demand for high-end apartments continues to increase in the city.

The demand for high-end residential units in Mumbai continued to rise in 1Q23 in anticipation of the proposed stamp duty hike from 1 April 2023. 

According to JLL, big-ticket deals have seen an uptick as industrialists, HNIs and Bollywood celebrities bought luxury apartments in the prime localities of Mumbai. Select projects in South Mumbai, namely Lodha Malabar and Oberoi 360 West, recorded notable deals.

Here’s more from JLL:

Eastern Suburbs I recorded the highest sales in 1Q23, accounting for 22.4%, followed by Thane and Navi Mumbai. The South Mumbai submarket recorded sales growth of 16.3% q-o-q. Projects that recorded healthy sales in this submarket include Lodha Malabar and Oberoi 360 West with prominent high-ticket transactions.

New launches lower by 7.3% q-o-q

A total of 4,974 units were launched in the high-end segment in 1Q23, a marginal fall of 7.3% q-o-q, though higher by nearly fourfold y-o-y. New launches were mostly driven by Thane, Western Suburbs I and II during the quarter.

New launches were, however, down q-o-q in key corridors like South Central Mumbai, Western Suburbs I and Eastern Suburbs I.

Capital values witness a marginal rise in 1Q23

Capital values recorded a slight q-o-q rise of 0.5% as the demand for high-end residential units remained growth-oriented. Increased input material costs was also a key factor for the rising capital values in the city.

Rents increased slightly in 1Q23, as most companies encouraged employees to work from the office, driving the surge in demand for rental housing. Also, the increased redevelopment activity in the city contributed to the rise in rents as such homeowners were actively adding to the rental housing demand.

Outlook: The high-end residential market is likely to sustain its pace

The high-end residential market is likely to continue its momentum going forward, on the back of the improved market sentiment and increasing demand for bigger homes.

The cost of key raw materials, such as steel, iron and cement, will be key influencing factors for the rise in capital values, as commodity prices have been on the upswing, though some cooling off is expected. Better demand levels should continue to support price growth in the high-end segment.