Property Prices In Mumbai Expected to Fall This Year As Well As The Next

India’s most expensive city in terms of capital value is expected to witness a fall in property price this year, as well as in 2021. According to a research report—Prime Global Residential Forecast— released today by Knight Frank, a real estate consultant, “Prime residential market of Mumbai is expected to see a price fall of 5% in the year 2020. For the year 2021, Mumbai’s prime residential market is expected to witness a price decline of 3%.”

Knight Frank analysed 20 cities globally to ascertain price movement in these cities in 2020 and 2021 based on projections for demand and supply, the impact of covid-19 in the different markets, and the varying government stimulus measures announced.

Given that most countries are still struggling to recover from the covid-19 pandemic, the impact of the crisis on the economy is yet to be fully estimated. Therefore, putting an exact figure on forecasts is challenging. Instead, Knight Frank has placed the 20 cities analysed into four categories: markets that will see strong price growth (+5% or more); those that will see low price growth (0% to 5%); those that will witness flat or low price falls (0% to -5%); and those expected to have strong price falls (-5% or more). Out of the 20 cities analysed, only four — Lisbon, Monaco, Vienna and Shanghai are expected to see price growth throughout the remainder of 2020.

Commenting on the findings of the research report, Shishir Baijal, chairman and managing director, Knight Frank India, said in a press release that, “the impact of Covid-19 is far reaching for most global markets which is reflected in the outlook for the prime residential segments. India’s key markets will also be faced with the uncertainty, mostly due to a significant erosion of confidence among buyers across spectrum. However, this also presents a ray of hope for serious buyers with adequate liquidity to enter the real estate segment in India and across the world as values would be attractive.”

Knight Frank also predicts that covid-19 may change the trend of home buying. It might bring about a change in priorities related to buying a second home, financing of a home, the rental market, and so on. However, the company believes that property will retain its appeal as a long-term investment and store of capital.

(Source: Livemint)