Mumbai Real Estate Market Witnesses 10% Surge in High-End Property Prices

Mumbai, 21st March 2024: Mumbai’s high-end real estate market has experienced a noteworthy 10% year-on-year surge in prices, predominantly fueled by affluent individuals seeking to enhance their lifestyles. This trend is mirrored in other major cities such as New Delhi and Bengaluru, albeit to a lesser extent, with Delhi-NCR seeing a 4.2% increase and Bengaluru a 2.2% rise in average annual prices during Q4 2023, as indicated by Knight Frank’s Prime Global Cities Index.

In Q4 2023, Mumbai witnessed the third highest year-on-year growth in prime residential prices, catapulting it up the ranking table by 5 positions to claim the 3rd spot from its 8th position in Q4 2022. Meanwhile, Delhi-NCR rose from the 28th rank to the 16th position, showcasing a 4.2% year-on-year growth. However, Bengaluru experienced a decline in ranking from 20th place in Q4 2022 to 27th rank in Q4 2023, despite recording a 2.2% year-on-year growth in residential prices.

The Knight Frank Prime Global Cities Index Q4 2023 revealed that Manila secured the top spot in the ranking with a remarkable 26.3% annual rise in prices, credited to robust domestic and foreign investments. Dubai followed closely with a 15.1% year-on-year growth, securing the 2nd position, while Mumbai clinched the 3rd spot with a 10% year-on-year growth.

This index, tracking the movement of prime residential prices across 45 cities worldwide, indicates a notable 3.7% rise in the global prime residential price index over the 12 months ending December 2023. This growth rate marks the strongest recorded since Q3 2022, with 82% of cities witnessing growth on an annual basis.

Shishir Baijal, Chairman and Managing Director at Knight Frank India, attributed the robust growth in prime prices to the surge in demand within the residential segment across Indian markets. With a growing emphasis on lifestyle enhancements among homebuyers, coupled with the country’s stable economic outlook and positive market sentiment, this segment is poised for further price escalation shortly.

Liam Bailey, Knight Frank’s Global Head of Research, noted that while the tightening of interest rates over the past 12 months has impacted sales volumes, leading to a decline of around 10% to 20% in most markets, prices have rebounded due to constrained supply. He anticipates that rate cuts in the latter half of 2024 will provide additional momentum to the market.