Mumbai’s realty sector has never had it so good.
Land being a precious commodity in the water-locked isle ofMumbai, its prices have been not just appreciating, but galloping…!
The increase in value of land and property in Mumbai rivalsthat of the increase in gold rates in the past one decade or so. The currentgold rate (@ Rs.33,000/tola) equals that of one square foot in the westernsuburbs!
Technically, even an ordinary slum dweller in Mumbai is amillionaire “ his shanty (if legal), is worth at least Rs10 lakhs !
Consider: After herculean efforts, a young woman hadpurchased a small tenement (chawl) in a corner of Borivli suburb in north-westMumbai in 2002, for Rs 2 lakhs. Today, 10 years later, she was stunned to getan offer of Rs 20 lakhs for the same tenement.
Around that time, a middle-class family managed to purchasea modest 2-bedroom-hall-kitchen flat in Kandivli suburb for Rs 20 lakhs; today,they are given ready offers of upto Rs 1.50 crore!
Investments in any kind of fixed assets “ plot of land,tenements, flats, bungalows “ few are constructed or sold these days “ or hugepenthouses, ensure astronomical returns within a short period.
On the upper end, despite rumours of 300,000 investor flatslying vacant, there is no dearth of buyers.
In a decent building in a middle-class locality, a 1-BHKflat can command nearly Rs 7-9 million, a 2BHK around 15-18 million, and beyondthat the prices run into several crores of rupees. In a new constructionrecently, parking slots were sold at Rs 10 lakhs and people paid up without ablink.
The surprising aspect is that salary levels in the privatesector have climbed to such an extent that banks are ready to shell out loansof Rs 50 lakhs to Rs 2 crores, if needed, to flat buyers.
There are various factors which fuel this trend. Chiefly, ofcourse, the ‘non availability’ of more land for development in Mumbai,admeasuring 425 sq kms.
Then, there are government policies spurring redevelopmentof old and dilapidated buildings, followed by improved infrastructure and modesof transport which have converted Mumbai metropolis into one huge village “easily accessible from any corner.
Yet, for the traditional middle-classes, the only hope for ahome in Mumbai is through various government schemes.
While the Maharashtra Housing & Area DevelopmentAuthority (MHADA) keeps building and selling flats at regular intervals atextremely affordable rates, it has failed to keep pace with the huge demand.
A potentially under-exploited scenario exists by way ofprospective buyers forming themselves into co-operative societies and seekingfor land allotment “ but government’s red-tapism discourages many.
Despite the bitterexperience of Adarsh Co-operative Housing Society scam, there is nothing tobeat self-developed co-operative housing as a quick, cheap alternative forhousing the miserable masses.
After all, there have been mega-success stories in milk andsugar co-operatives (or, even co-operative governments, or coalitions) in thecountry, so why not encourage housing co-operatives, an aberration like AdarshSociety notwithstanding.
In view of the long list of flat buyers in the city, thestate government would render a great service to the people of Mumbai (voters!)by encouraging public housing co-operatives.
It needs to be accompanied with single window clearances ofall permissions to ensure that it is achievable within a reasonable time-frame“ say, two years from application.
