Demand for ready-to-move-in homes grows in Mumbai

10 Mar 2016

While a majority of the home buyers in the city of Mumbai prefers ready-to-move-in properties, as against the new launches and under-construction projects, statistics prove that the sentiment is not the same across micro markets.

As a matter of fact, within the Mumbai Municipal Regional Development Authority (MMRDA), the established locations and locations that are business centres are more sought-after for ready-to-move-in properties. On the other hand, peripheral locations have a less preference, compared to established locations by buyers.

Bandra, BKC, Juhu, Goregaon and Andheri are preferred destinations today as per reports. On the other hand, peripheral locations like Dahisar, Mira Road, Vasai, Virar, Kalyan and Dombivali have a relatively lesser demand.

Deepak Achrekar, a real estate agent in Mumbai believes that the demand is directly proportional to a home buyer's immediate needs. While anyone who is looking for a house close to the business centre enjoys the benefit of having his workplace closer, this necessarily does not ring true with those who are investing in the peripheral locations. They might be buying these properties to shift at a later stage as well. 

"Peripheral locations are also known for investor activity. In some of these locations, even though the economic activity takes time to pick up, the buyers choose to wait for some time before they plan to shift. They also perceive it as a second home destination," says Achrekar.

Sumedha Agnihotri had bought an apartment two years ago in Thane. She believes that the dilemma associated with the purchase of a ready-to-move-in house as opposed to an under-construction one, is manageable because instant possession is guaranteed in the former. 

Eventually, she compromised with her first choice of location at Chandivali near Andheri east, to move to Thane, as the price of a ready property was too high in Chandivali. 

"See, given a choice, any home buyer will opt for a ready-to-move-in property. But then, a ready apartment has its own premium, which is way higher in price compared to an under construction one. With the kind of budget that I had, I could have either bought a ready property in Thane or an under-construction one in Chandivali," says Agnihotri.

Developers, on their part, find reasons as to why business centres attract more buyers for ready properties in and around Mumbai. Vipul Shah, managing director, Parinee Group, points out that it has a lot to do with the ticket size of the apartments. 

According to him, the size, demand and supply dynamics and financial arrangements collectively, drive this trend of more demand for ready properties near business centres. In most cases, it is the buyer's immediate financial standing to pay upfront that is key.

"Most of the projects in and around areas like BKC or any other business centres are high-value projects with limited inventory. The buyer in this segment normally has more cash in-hand and chooses to refrain from relying on the credit score to avail loans. On the other hand, in peripheral locations, most of the buyers belong to the salaried class who opt for subvention schemes and it suits them to choose under construction properties," says Shah. 

Beyond this cost and benefit analysis, it is indeed a fact that a majority of the home-buyers vouches for a ready-to-move-in property. Indeed, instant gratification is something we all desire!