Prices of Residential land increase by over 35% in 2 years: Survey
Over the last two years, in Mumbai, values of land, which are used for development of residential projects, have appreciated by almost 35.2 percent mainly due to change in norms and increase in property prices, a recent survey said.
Knight Frank conducted a survey of 13 top Asian cities on the parameters of values of land used for residential and commercial projects and pointed out that Mumbai is an expensive market compared to Delhi NCR and Bangalore, which have been studied in the report.
According to the report, in the last two years Mumbai’s residential development land prices appreciated by 35.2 percent, while those of Bangalore grew by 26.1 percent and Delhi NCR by 24.9 percent.
Conversely land prices fell by 13.1 percent, in terms of office space development, even as Delhi NCR and Bangalore registered a growth of 16.3 percent and 12.9 percent, respectively.
“Prices for land used for residential development in Mumbai increased owing to change in development norms coupled with increase in residential prices. However, decline in the office development land index was led by fall in office space absorption combined with large quantum of supply,” the report said.
The report noted that owing to the increase in prime property prices and steady demand prime residential development land index for NCR witnessed an appreciation of 24.9 percent.
Budding markets of Gurgaon, when compared to the established markets of Connaught Place and Saket, demonstrate a much higher rise in prime office land values, it said.
In case of Bangalore, steady job growth led to increase in property prices and demand for housing which enabled residential land prices to grow 26.1 percent. Similarly, office development land prices increased owing to the demand from the IT/ITeS sectors.
Research Samantak Das, Knight Frank Chief Economist and Director, said, “While Mumbai emerged as the worst performer in the office space front, it witnessed maximum appreciation compared to National Capital Region and Bangalore in residential land prices”
Due to limited land availability in Mumbai, prices are likely to continue to grow in the coming future mainly because of its poor quality infrastructure and regulatory constraints that have strictly restricted creation of new housing stock, resulting in an ever widening demand supply gap and subsequent increase in-built property prices.
Source: Zee News
Asian cities, Bangalore, Connaught Place, Delhi NCR, Gurgaon, IT/ITES sectors, Knight Frank, Land index, Mumbai, Property Prices, Residential and commercial projects, Residential projects, Saket, Samantak Das
