City’s poshest homes now cheaper, but...

Despite 20 to 50 per cent fall in real estate prices in best buildings, buyers still play the waiting game

City's poshest homes now cheaper, but...

Despite 20 to 50 per cent fall in real estate prices in best buildings, buyers still play the waiting game

Owning a house in Malabar Hill or in Andheri's posh Lokhandwala area has probably been a distant dream for many Mumbaikars, as real estate prices in these areas were sky-high.

But since October 2008, the rates in these and other posh areas in Worli, Prabhadevi, Bandra, Juhu and Versova, have dropped by a significant 20 per cent.

Yet, there has been no mad rush to purchase property in these areas as buyers expect the prices to go further down.

Surprising, because last year, the rate was more than double, at Rs 1,20,000 per sq ft.

According to Yashwant Dalal, a real estate agent from South Mumbai, and president of the Estate Agents' Association of India, the real estate market is stagnating.

Buildings that were commanding rates of nearly Rs 70,000-90,000 per sq ft, even a few months back, are still unable to find buyers, even though the rates have come down by 50 per cent.
u00a0
"A builder was demanding nearly Rs 25 crore for a 4,800 sq ft pent house in Worli. He has now reduced the price to Rs 20 crore, but still can't find a buyer," said Dalal.

In another building at Appa Saheb Marg in Prabhadevi, the rate has come down from Rs 55,000 per sq ft to approximately Rs 28,000.

Dalal said that areas such as Lower Parel that were asking for nearly Rs 28,000 per sq ft till a few months back have come down to Rs 14,000, but again, there are hardly any buyers.

Same case scenario

The situation is the same in other parts of the city such as Bandra and Andheri. Sangeet Kumar, an estate agent in the western suburbs, says the rates there too have come down drastically.

Juhu Scheme, which demanded not less than Rs 22,000 per sq ft six to eight months back, is now offering a flat at a good location for Rs 16-17,000 per sq ft.

"The rates haven't come down, rather they have been corrected. However, buyers are still waiting. They want the rates in Juhu to come down to Rs 14,000 per sq ft," said Kumar.

Still a dream...

Experts are happy that the rates in these posh localities have come down, but they are not optimistic about the common man being able to buy his dream home here.

According to Ajay Chaturvedi, a real estate expert, "Right now, the drop is nearly 25 per cent. I expect it to fall further.

However, it would take another 20 years for the rate to come to the level where the common man can afford a home in these localities, as the builders are never going to reduce the price to what it was way back in 2000."

Added Dalal, "A year ago, I sold a flat in Prabhadevi at the rate of Rs 55,000 sq ft. Three years ago, it demanded only Rs 6,000 per sq ft."

"Exciting news! Mid-day is now on WhatsApp Channels