Mumbai's property market climbs 18 places in global index
The Prime Global Cities Index shows an average increase in annual prime residential prices at 2.1 per cent across the 46 global markets during the 12-month period ending in September 2023
Mumbai has recently garnered global attention with a remarkable increase in prime residential prices, according to Knight Frank's Prime Global Cities Index. The financial capital of India recorded the fourth-highest year-on-year growth in prime residential prices for the quarter ending September 2023, marking a significant 6.5 per cent surge. This impressive upswing has propelled Mumbai up by 18 positions in the global rankings from the 22nd spot in September 2022.
The Prime Global Cities Index is a valuation-based indicator that meticulously tracks the movement of prime residential prices across 46 cities worldwide. The index primarily focuses on nominal prices in local currencies. New Delhi and Bengaluru also demonstrated upward mobility in their index rankings, signifying India's robust real estate market, the Indian Express reported.
In particular, New Delhi's National Capital Region (NCR) made a substantial leap, advancing from 36th a year ago to 10th in September 2023, boasting a remarkable growth of 4.1 per cent year-on-year, as reported by Knight Frank. Bengaluru experienced noteworthy progress as well, moving from 27th spot in 2022 to 17th in 2023, with a commendable growth rate of 2.2 per cent.
The Prime Global Cities Index disclosed an average increase in annual prime residential prices of 2.1 per cent across the 46 global markets during the 12-month period ending September 2023. This marks the most substantial growth rate recorded since the third quarter of 2022 and underscores the resilience of the global real estate market, with 67 per cent of cities reporting annual growth.
Claiming the top spot on the index was Manila, capital of the Philippines, with a remarkable 21.2 per cent increase in prime residential prices. This growth is attributed to a combination of strong domestic and foreign investments. Dubai, which had held the top position for eight consecutive quarters, fell to second place owing to a sharp decline in quarterly growth, from 11.6 per cent in the June quarter to a mere 0.7 per cent in the September quarter.
Alongside, San Francisco emerged as the weakest market, with a disheartening 9.7 per cent decline in prime residential prices yearly.
On Mumbai's remarkable performance, Shishir Baijal, chairman and managing director of Knight Frank India, said, “The robust price trend in the upper end of the market coupled with strong sales momentum has elevated Mumbai's position in this global ranking scale. Sales momentum is significantly stronger in the higher ticket sizes today than in the past five years.”
Baijal expressed his optimism about the future, saying, "The homebuyers' increasing need to upgrade their lifestyle, coupled with stable economic prospects of the country and improving market sentiments, should sustain price growth in the short to medium term."
Liam Bailey, Knight Frank's Global head of research, offered a balanced perspective, noting, “Prime market homeowners will welcome the improvement in average annual house price growth but shouldn't be overstated. Higher rates mean we have moved into a world of lower asset price growth — and investors will need to work harder to identify opportunities for outperformance to secure target returns.”
Mumbai's ascent in the rankings and the overall growth in India's real estate market bodes well for the economy and its burgeoning real estate sector. The continued stability and potential for further growth are anticipated to be key drivers of the country's real estate market in the foreseeable future.