Policy changes and elections affect real estate sector in Mumbai
Investment in the real estate sector has decreased due to the political uncertainties, elections and due to changes in the regulatory framework. As Mumbai continues to suffer the most, the 2014 situation of National Capital Region (NCR) of Delhi and Bengaluru is still better, comparatively.
In 2013, investments in land witnessed 61 per cent decrease and in office space, it dropped by 77 percent. The overall investment in the sector drops by 65 percent in 2013 during the previous year.
Mr. Sanjay Dutt, executive managing director, South Asia, Cushman & Wakefield, says that there is painful stop that the investors have noticed as far as the Indian real estate market situation is concerned. He further added that the advised regulatory framework changes are yet to be implemented. All this is to keep investors from making future` investments.
Mr.Dutt was quick to clarify that this decrease in investment numbers were not indicative of the sentiments investors have of India, as it continues to show future promise as it is an important market in the Apac region. This is shown by the rise in private equity of nearly 13 percent in 2013. It is expected that, by 2015, the investment markets and economic conditions will start to improve further.
The APAC region noticed a received $487 billion of investment in the real estate sector. China recieved the highest investments of $358 billion followed by Japan which received the investment of value $44.6 billion in 2013.
Mr. Samantak Das, chief economist and director research, Knight Frank India, says that the outcome of our inaugural prime Asia development land shows that the land prices in all three Indian cities are likely to increase. Mumbai noticed maximum growth as compared with NCR and Bengaluru.
Mr. Fali Poncha, director, land, Mumbai, says that the increase in population and the economic condition are responsible for increase in demand for housing in Mumbai in last 10 to 15 years.
In the last 2 years, prime residential development land index for NCR has noticed the growth of 24.9 percent due to increase in prime property prices and steady demand.
The emerging markets of Gurgaon shows a much higher rise in prime office land values compared to the established markets of Connaught Place and Saket. Lack of land in major locations and stable demand are expected to push up rentals. Bengaluru’s emergence as a suitable IT/ITeS destination is responsible for the growth of city.
In last 24 months, the prime residential development index for Bengaluru has seen a growth of 26.1 per cent due to the increase in prime property price and steady job growth. During the same time prime office development index saw a growth of 12.9 percent with the healthy leasing market.
Source: mydigitafc.com
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