Mumbai's residential sales value to reach new heights

MUMBAI, AUGUST 29, 2024: Mumbai's resilient residential market continues its onwards strides with significant growth in sales and new launches. As India’s financial capital, Mumbai continues to attract substantial real estate investments, exemplified by record-high sales values and strategic infrastructure developments, said JLL's latest report, "Mumbai Residential Market-Through the Lens of Time," launched today at the National Real Estate Development Council (NAREDCO)’s flagship event, The Real Estate Forum (TREF) 2024 held in Mumbai. JLL is the Knowledge Partner for the event. The city’s comprehensive infrastructure projects, including the Mumbai Trans Harbour Link (MTHL), Navi Mumbai Suburban Rail, and various Metro lines, have significantly improved its connectivity with the suburbs and the sister cities of Thane and Navi Mumbai. This enhanced accessibility has directly contributed to an uptick in residential launches and sales, particularly in Navi Mumbai, Thane, and Western Suburbs II.

As of June 2024, Mumbai stands as one of the leading contributors to pan-India launches and sales. Residential sales value in 2023 breached INR 1 lakh crore and is expected to surpass INR 1.35 lakh crore in 2024, setting a record high for the city.Additionally, the Months To Sell (MTS) inventory decreased from 58 months in March 2022 to 31 months in June 2024. By 2030, the ongoing infrastructure projects aiming to enhance multimodal connectivity are expected to foster new residential hubs and revitalize existing ones.

“Mumbai’s real estate development started in the south and shifted to the suburban markets in north and east by 2016. City’s significant focus on multi-modal means of transport by mid- 2024 created further boost and resulted in growth of new areas and regeneration of the existing core city locations. Infrastructure initiatives planned by 2030, are expected to reduce the average travel time within the city by 50%, promote residential sector growth as well reduce the pressure on existing modes of public transportation,” said Dr Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.

Mumbai's residential real estate market has experienced a significant boost over the last few years, thanks to the effective implementation of MahaRERA. Post the pandemic, the market saw a remarkable recovery in both sales volumes and new project launches, reaching unprecedented heights in 2022. This positive trend sustained in 2023, marking another milestone in the city’s residential asset class. In the first half of 2024, Mumbai's residential market achieved its highest-ever sales over a six-month period, already reaching around 57% of the total sales recorded in 2023. As a result, Mumbai's contribution to India's overall residential market activity has grown substantially, accounting for approximately 25% of new project launches and 22% of total sales from 2022 to H1 2024. The residential sales value during this period exceeded INR 2.8 lakh crore. While completion of prominent infrastructure projects like the Mumbai Trans Harbour Link and Navi Mumbai Metro Line 1, have enhanced Navi Mumbai’s prominence as a residential hub, Western Suburbs II has benefited significantly from Metro lines 7 and 2A, thereby emerging as one of the residential hotspots for new launches and sales.

Mr. Prashant Sharma, President, NAREDCO Maharashtra, commented, "The robust growth trajectory of Mumbai's residential real estate market, as outlined in JLL's latest report, underscores the city's pivotal role in shaping India's real estate landscape. The remarkable sales volumes and the significant land acquisitions for future developments reflect the confidence that both developers and homebuyers have in the city’s long-term potential. As infrastructure projects continue to enhance connectivity and create new residential hubs, we foresee Mumbai’s market not only maintaining its momentum but also setting new benchmarks in the coming years. NAREDCO Maharashtra, through The Real Estate Forum 2024 is committed to supporting this growth by fostering a conducive environment for development, ensuring that Mumbai remains at the forefront of India’s residential sector."

“As of June 2024, Mumbai stands as one of the leading contributors to pan India launches and sales. It is also the largest residential market in terms of sales value which is expected to surpass INR 1.35 lakh crore in 2024 - a record high for the city.Planned infrastructure expansions have encouraged developers to acquire a total of more than 260 acres of land (since 2022) within the city limits and its peripherals for future residential developments, thereby paving the way for MMR’s expansion,” said Karan Singh Sodi, Senior Managing Director - Mumbai MMR & Gujarat, and Head Alternatives, India, JLL.

Developers in Mumbai have successfully acquired a sprawling 260acres of land (since 2022) through outright purchase or joint development agreements, all earmarked for residential development. This substantial land acquisition equates to an immense development potential of 42-48million sq. ft, with an estimated sales potential of over INR 70,000crore. The city has also witnessed the entry of notable national and regional developers, who have chosen Mumbai as launchpad for their residential projects. Moving forward, JLL anticipates a consistent and healthy momentum in residential sales, albeit with a moderation in capital value appreciation. Looking ahead to the future, the Mumbai market is projected to surpass the remarkable milestone of INR 2 lakh crore in residential sales value by 2030.

Looking Ahead

Mumbai's real estate development has shifted from the southern parts to the north and east suburbs due to increased demand for housing, improved connectivity, and available land. The initiation of transit infrastructure networks has further propelled growth in these areas. Navi Mumbai and Thane have emerged as popular residential destinations, supported by infrastructure improvements and connectivity. The city offers a wide range of residential opportunities across different price segments, with attractive returns. While redevelopment is a key strategy in core city areas, infrastructure developments like the Coastal Road and Metro expansions present opportunities across both the Island City and Suburbs.

Note: Mumbai includes Mumbai city, Mumbai suburbs, Thane city and Navi Mumbai. Residential sales value is estimated based on the primary market.

National Real Estate Development Council (NAREDCO) was established as an autonomous self-regulatory body in 1998 under the aegis of Ministry of Housing and Urban Poverty Alleviation, Government of India. It is in this year that the Government of India redrafted the National Housing & Habitat Policy, giving due importance to the Housing and Real Estate sector, thereby declaring housing for all citizens by the year 2010.

The Indian housing and real estate sectors and the allied industries hailed the establishment of NAREDCO, as the apex national body for the real estate industry and visualized it as a single platform where Government, industry and public would discuss various problems and opportunities face to face which would result in speedy resolution of issues. It was formed with the mandate to induce transparency and ethics in real estate business and transform the unorganized Indian real estate sector into a matured and globally competitive business sector.