Mumbai is a large city. It has the second-highest population in India. It serves as the business, entertainment, and financial hub of the nation. The city is one of the leading hubs of commerce in the world. It produces 6.16% of India's GDP.
The city contributes to the growth of the country. It generates a large part of the income tax collections. The excise tax collections and customs duty from here are also high. Mumbai has seen an economic boom since liberalization in 1991. The finance boom of the mid-1990s and the IT boom of the 2000s have also added to its growth.
The local housing market is growing. It has grown very quickly. Rent rises of up to 15% have been observed in the city's western suburbs. An estimated 3,000 projects are now being built. About 60% of these are redevelopments. There are several old structures being rebuilt.
In Mumbai, rents rise by roughly 5% yearly. There are two reasons for this. One is that rents increased as people began to return to the city after the pandemic. The second reason is redevelopment. Many areas in the city are seeing reconstruction. These have caused rentals in these areas to rise by as much as 15%.
In places like Bandra and Kandivali, every third or fourth building is being demolished. The families living in the structures are leaving the area. Others are renting homes close by. Experts in the field say this has resulted in a rise in rental rates in the city.
The city has a high density of people. People want to stay near the city's main areas. People are now buying large homes in upscale projects while renting out their own houses. People now want larger homes in addition to more fancy amenities.
The Prestige Group CMD, Mr. Irfan Razack, says that redevelopments are one of the ways to develop the city. There is not much land available here. He says that the only way to get land for projects is through redevelopment.
The city has lots of aging structures. The company gets many proposals for redevelopment projects. It is studying each of these. It is actively working on a few of these projects. Mr. Razack says these are a long process.
Mr. Razack says that though it is a drawn-out process, it is working. The group did not get involved in the redevelopment project at Dharavi. The chairman says the company has just entered the Mumbai market. They are moving carefully in it. They do not want to rush into it.
The group is entering the market in a measured way. It does not want to get into something that is too much for it to handle. He said that interest rates are increasing. These have had an impact on the market. Rising interest rates are a concern because it affects the affordability of homes.
A handful of the rebuilding projects are being carried out by the group. These are successful. Mr. Razack says the company is focused on doing them well. Its primary goal is to succeed in the projects. It concentrates on delivery.
Projects being completed on time means that buyers gain faith in the company. The group knows that this is important. The company aims to deliver high-quality builds on time. It wants to become a leader in the city's real estate market.
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