Aug 28th, 2023
A recent report from Knight Frank, a leading real estate consultancy, has forecasted a significant 5% increase in residential property prices in Mumbai in 2024. This surge is set to make Mumbai one of the top cities globally in terms of residential price appreciation. Interestingly, Auckland and New Zealand are also expected to witness a similar 5% price hike.
Several factors contribute to this optimistic prediction for Mumbai. Firstly, improving Gross Domestic Product (GDP) figures is playing a vital role in boosting the city's luxury housing market. Additionally, Mumbai's relative value and substantial investments in infrastructure development are further driving the price growth in the residential sector.
When compared to other cities worldwide, Mumbai ranked sixth in terms of year-on-year price growth, recording a notable 5.2% increase in the second quarter of 2023. Dubai, however, retained its top position globally for the eighth consecutive quarter with a remarkable 48.8% year-on-year increase in prime residential property values. Tokyo and Manila followed closely with growth rates of 26.2% and 19.9%, respectively.
Residential Property Price Growth
|City||Year-on-Year Growth (%)|
Indian Cities in the Mix
Apart from Mumbai, two other Indian cities made it to the list. Bengaluru secured the 20th position with a 3.6% year-on-year price increase, while New Delhi stood at the 26th spot with a marginal 0.2% uptick in property prices.
Looking at the broader global scenario, the average annual growth rate across the covered markets reached 1.5%, indicating a positive shift after a period of uncertainty. Cities like Berlin and Edinburgh are anticipated to experience a decline in residential prices, with drops of 1% and 3%, respectively. In contrast, some cities, like Dubai, have witnessed robust growth, maintaining their positions at the forefront of the global real estate market.
Factors Influencing Price Trends
Knight Frank's report highlights several factors contributing to these price trends, including strong underlying demand, limited supply due to disruptions in new-build projects during the pandemic, and the gradual return of workers to cities. While global housing markets continue to face pressure from rising interest rates, the report suggests that price adjustments may be less severe than initially expected.
For the year 2024, Knight Frank predicts that Mumbai and Auckland will lead the way with a 5% increase in prime residential prices. This positive outlook is driven by improving GDP figures, the relative value of these cities, and significant investments in infrastructure, all of which are set to propel luxury housing prices to new heights.
In a real estate market characterised by resilience and optimism, Mumbai's property sector appears poised for continued growth, offering exciting opportunities for investors and homeowners alike.
The Indian real estate market, particularly in Mumbai, continues to exhibit resilience and growth potential, driven by a combination of economic factors and strategic investments in infrastructure.
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