NAREDCO Maharashtra and 1 Finance unveil Key Insights from Excelerate 3.0: Addressing Affordability and Unlocking Greater Mumbai’s Real Estate Potential

The real estate market in Greater Mumbai is one of the most complex and competitive markets where collaborative and innovative solutions are key to success. A new research report on the current trends, challenges and opportunities for the sector was released at Excelerate 3.0 which was hosted by NAREDCO Maharashtra and 1 Finance. Attended by some of the top leaders from reputed brands, the event gave pertinent information on how regulatory reforms and market adjustments can enhance sustainable growth and affordability in Mumbais real estate market. 

Key Highlights of Excelerate 3.0  

1. Understanding Market Dynamics  

The report delves into the core aspects of Greater Mumbai’s real estate sector, examining pricing trends, transaction volumes, and inventory levels. Currently, the average price per square foot (PSF) in the city stands at ₹32,150. Furthermore, 29% of homes sold are priced above ₹2 crores, highlighting the premium nature of the market.  

However, affordability for the affluent middle class in Mumbai remains the lowest among India’s top cities. This underscores the pressing need for regulatory reforms to address rising costs and enhance homeownership accessibility.  

2. Real Estate as a Resilient Asset Class  

Sure, it is challenging but Real Estate still remains one of the best investment options. From decade to decade, it has given an average of about 12% return that is similar in proportion with gold & much higher against accrued investments which mirrored a rounded off return of upto about 7%.

What real estate brings to a portfolio that few assets can offer is low correlation with equities and debt, which makes it an useful diversifier over the long haul. These perception and reality are the two main reason why real estate as an asset class is a solid sustainable investment for both homeowners and investors.  

3. Collaboration as a Catalyst for Change  

Dr. Niranjan Hiranandani, Assocham, and Mr. Rajan Bandelkar of Naredco are key speakers at the event who advocated for public-private partnerships at the top summit. A robust collaboration among developers, policy makers and financial institutions can effectively tackle the essential affordability issues and facilitate a more inclusive ecosystem.

The President of NAREDCO Maharashtra, Mr. Prashant Sharma said the need of the hour is for regulatory to get into reform mode and for quick approvals and rationalization in premium to take place. These reforms will not only make the housing market more efficient but also rein in the rising costs that plague Mumbai.  

Affordability Challenges in Greater Mumbai  

Mumbai’s affordability crisis stems from its high property prices and shrinking apartment sizes, which have significantly impacted the quality of urban living. Government policies, aimed at regulating development and funding urban infrastructure, have inadvertently contributed to escalating costs.  

While these policies ensure a controlled and systematic urban growth, they have also led to increased premiums for developers. The result? Higher property prices, placing homeownership beyond the reach of many middle-class buyers.  

A Path Forward  

To ensure a sustainable and affordable real estate market in Mumbai, decisive action and innovative strategies are required. Here are the key recommendations from the research report:  

1. Regulatory Reforms: Streamline approval processes and rationalize premiums to reduce development costs and encourage affordability.  

2. Innovative Financing Solutions: Develop new financial products tailored to the needs of middle-income homebuyers, making ownership more accessible.  

3. Focus on Micro Markets: Identify and develop high-potential areas to balance affordability with proximity to urban amenities.  

4. Collaboration Across Sectors: Strengthen partnerships between government bodies, private developers, and financial institutions to drive impactful change.  

Insights from Industry Leaders  

Mr. Keval Bhanushali, Co-founder & CEO of 1 Finance, highlighted the need to elevate real estate advisory as a standard component of financial planning. By integrating real estate investment into broader financial strategies, prospective buyers and investors can make more informed decisions.  

Mr. Ridham Gada, President of NAREDCO NextGen Maharashtra, emphasized the importance of fostering innovation to address the affordability gap. A collaborative approach is essential to ensure Mumbai remains a thriving metropolis that is accessible to all.  

Real Estate Investment: Balancing Returns and Security  

The research report also highlights the distinct value proposition that real estate brings as an investment class. Real Estate is a proven, stable and sound asset to diversify portfolios because of little correlation with stocks and bonds. Its attractiveness for investors also lies in the fact that it has the potential to generate rental yields and long-term appreciation.

Prospective investors looking to invest in Greater Mumbai should target high-potential micro markets and enter with reputable developers to balance out optimal returns with risk.  

Conclusion  

Excelerate 3.0 provides a well-rounded picture of the obstacles and openings of real estate market in Greater Mumbai. Through tackling affordability challenges and making it easier for different sectors to collaborate, Mumbai will be able to offer a sustainable future along with avenues for homeownership to its citizens.

Real estate remains the foundation of ever-growing financial security. For potential first-time homebuyers as well as investors, it is a time to do the necessary research into some of the competing factors and sweep up the benefits in this still relatively strong property asset class.

Let us come together to make Mumbai not only the best metropolitan for India but a role model for as an integrated city.