Centrum Broking Pvt Ltd today shared findings from its research report on the Mumbai Real Estate Sector. It expects a 30-35% fall in India’s residential prices from the peak, with the Mumbai Metropolitan Region (MMR) estimated to witness the lowest fall of 20-30% until April 2009. Residential demand in Mumbai is estimated at 66mn.sq.ft. vs 55mn.sq.ft supply The report says that the decline in real estate prices in Mumbai will bring back affordability and is expected to boost demand. The factors that are likely to result in a lesser price drop in MMR include

The favorable demand supply equation shields against steep correction in Mumbai - Owing to its geography and high population density, Mumbai has limited land area and demand for quality properties tends to far outstrip supply, resulting in high prices. Slum rehabilitation, redevelopment unique business opportunity in Mumbai Mumbai provides opportunity to real estate players participating in the highly lucrative slum rehabilitation and development business considering that half of Mumbai’s 12 million population lives in slums.

Strong cash flow visibility for Mumbai focused property developers – Stable cash flow of Mumbai focused developers will help these companies tide over the liquidity crunch. Mumbai suburbs to witness huge supply - The trend for suburbanization is likely to continue with suburban locations capturing demand for small to medium format spaces. Redevelopment of properties – Mumbai offers huge opportunities for developers in the redevelopment space. According to a survey done by the Maharashtra Housing Area Development Authority (MHADA) in 2006, Mumbai has 19642 dilapidated buildings that are more than 40-100 years old.

Harendra Kumar Head of Research, Centrum Broking Pvt Ltd says “Mumbai is uniquely placed as compared to other cities because of its huge population, need for housing and the opportunities that are available. We are optimistic that with the correction in the prices there will be a spurt in the demand.”

SRC: www.indianrealtynews.com