Mumbai real estate: After prolonged slowdown, rise in demand of under ₹30 lakh homes seen in the city

Also Read: After prolonged slowdown, rise in demand of under ₹30 lakh homes seen in Mumbai

Meanwhile, the island city continues to remain elusive to this segment even though Maharashtra Housing and Area Development Board (MHADA) recently released home units priced below ₹45 lakh for sale for the lower income group in Wadala, Kurla, Vikhroli and Antop Hill. These units were announced through lottery on August 8, most of them redevelopment surpluses on MHADA land.

Pankaj Kapoor, director, Liases Foras, said, “If this trend continues we will soon see a ‘V’ shaped recovery in this segment, which has seen a steady decline in the last several quarters.” ‘V’ shaped recovery symbolises an upswing after a decline.

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The surge, he said, comes in the backdrop of budgetary announcements made by union finance minister Nirmala Sitharaman to resuscitate the sector. “Though it’s too early to pinpoint the exact reasons for the growth as sops take time to manifest, there is no denying that affordable housing is gaining traction,” he said.

Of the total 6,675 low income units launched between March and June 2024, 2516 were in the north east region, followed by 1807 units in the Palghar-Boisar region. Titwala east, despite being the smallest of the three, saw 964 new launches, the study said.

Quarterly sales saw a growth of 8%. Moreover, 84 new projects were launched between March and June by top local developers including Dream Homes, Vansh Developers, Avyu Buildcon Pvt Ltd, Sun Homes and Saphale Land Developers LLP.

Jash Panchamia, partner, Suraksha Group, that is developing affordable housing in a sprawling 362-acre township in Vasai corroborated the study’s findings. He said in three months, between March and May, 2024, his company clocked 6,500 bookings in the Suraksha Smart City township under the Pradhan Mantri Awaz Yojana (PMAY). This was the result of the government widening the scope of eligibility among the economically weaker sections — from the previous annual income of ‘ ₹0 to ₹3 lakh’ to ‘ ₹0 to ₹6 lakh’. This drew a flood of buyers who could avail of bank loans to purchase the 30-sq mt units priced at approximately ₹22.5 lakh.

Kapoor added that revival of the credit linked subsidy scheme (CLSS) which was discontinued, has proved to be attractive for the low income group of buyers both within the PMAY and the open market. It offers them a discount of nearly ₹2.70 lakh upfront in their EMIs and purchases, along with a flat ₹1000 stamp duty.

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And yet, local brokers in Vasai-Virar and Boisar-Palgar region feel affordable homes are not selling as expected as awareness of the scheme announced in the budget is still low. “Banks have yet to receive the GR notification or government funds, so the schemes are yet to take off in the open market,” said Dr Ajay Dubey, president, Property Dealers Association in this micro market.

Dr Prashant Thakur, head of research, ANAROCK Group, on the other hand reasoned that the city is in the cusp of two extremes. On the one hand, affordable housing is gaining traction in the periphery catering to the unorganised sector, while on the other hand, “land parcels in the island city and close suburbs remain out of their reach to cater to this segment as they are expensive”.

Gulam Zia, senior executive director, Knight Frank India, added, once the infrastructure projects are up and running this segment will receive further boost. “With connectivity, people will not mind travelling from their homes in the outskirts of Mumbai to places of work in the island city and suburbs. Hence, the government must deliver on its infra promise by meeting timelines.”