12000 Per Sq Ft: New Normal Rate in Mumbai Realty

Recently, Mumbai has made through the list of World’s 20 most expensive luxury rentals. India’s traditional real estate market, Mumbai has become unaffordable for most of the home buyers mainly for middle class buyers. The residential prices in the city have shot up to 50 percent since the fourth quarter of 2008, which is next only to Hong Kong and Shanghai where prices have increased to 95 percent and 70 percent, respectively, according to real estate consultancy Knight Frank.

For example, areas in North East Mumbai where the average price of an apartment costs around 7000 to 7500 per square feet back in 2009, the same apartment now costs nearly 12,000 a square feet. The price level is more or less similar to the suburbs in North Mumbai in areas like Borivali.

"(Given) the way rates have gone up, you cannot buy an apartment in any decent area for less than 10,000-12,000 a square foot. The city is out-pricing itself," said Akshaya Kumar, Chief Executive Officer, Park Lane Property Advisors, a property consultancy.

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