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Luxury Home Prices In Mumbai Expected To Fall By 1 Pc In 2020: Knight Frank
These areas include Cuffe Parade, Napean Sea Road, Colaba, Lower Parel, Worli, Tardeo, Juhu, Bandra Kurla Complex, Santacruz West, Bandra West, Khar West and Prabhadevi, according to its latest report Prime Global Forecast 2020.
"The buyers of prime residential properties in Mumbai are expected to remain cautious in 2020 due to deteriorating economic environment impacting market liquidity and an additional one per cent stamp duty being levied by the Maharashtra government, taking the total to six per cent.
According to Knight Frank Prime Global Cities Index Q3 2019, while Mumbai Real Estate was ranked as the 28th fastest-growing prime residential market in the world, registering a 0.8 per cent year-on-year increase in average capital value in Q3 2019, the prices had actually remained stable in the past three months.
In the last decade, Projects in Mumbai has seen a 12.7 per cent price appreciation in prime residential properties. The index also highlighted that the change in prime residential prices for all 45 cities tracked by the index averaged 1.1 per cent in the year to Q3 2019, growing at the slowest rate in a decade.
Both demand and sales of prime residential properties in Mumbai are expected to see a slight fall, while the supply of luxury homes is estimated to drop significantly in 2020, according to Prime Global Forecast 2020.
The average capital values of prime residential property in Mumbai currently stands at Rs 64,775 per square feet, making it the most expensive city for buying luxury homes in India.
Paris leads the prime residential forecast for 2020 with an expected price growth of 7 per cent followed by Berlin and Miami in the second place with a 5 per cent growth each, and Geneva and Sydney at the third place with an expected prime residential price growth of 4 per cent each.
A prime residential project in mumbai is defined as the most desirable and most expensive property in a given location, generally defined as the top 5 per cent of each market by value. In the Prime Global Forecast 2020 report, Knight Frank's analysts provide their price forecast for 2020, taking account of the latest economic indicators, supply, demand and sales trends.
The report also highlights the 10 biggest risks to prime residential India real estate markets in 2020 as global economic slowdown, global trade war, local economic slowdown, changes to property market regulations, geopolitical crises, change in government/upcoming election, emerging market volatility, oversupply of luxury homes, currency instability, Brexit, US Federal Reserve rate changes and commodity prices.
"Despite interest rates remaining low, sales volume of the prime end of the market in global top tier cities has largely drifted lower during 2019," said Shishir Baijal, Chairman and Managing Director of Knight Frank India.
"Prime residential market in Mumbai has also echoed the same sentiment. In Indian Real Estate, the segment has now become a business for only the organised and well-funded players to venture into. Each world region will be marked by different risk set to prime property," he said.