Redevelopment projects cause rental escalations of up to 15%

Residential complexes in Mumbai City are fast opting for redevelopment. A concept that used to scare many is now being embraced by several housing societies across the region. Several government initiatives introduced in the recent past have helped society members opt for self-redevelopment and encouraged builders to take on such projects by way of additional FSI. As a result of this, several micro markets in Mumbai are experiencing a sudden surge in rental yields.

During the pandemic, the city witnessed a dip in rental yields has many individuals returned to their hometowns thereby creating latent supply. However, now that almost all pandemic restrictions have been lifted, offices are calling employees back to the office. This has once again spiked demand resulting in raised prices. To add to this, certain micro markets such as Juhu, Bandra, Khar, Borivali and Kandivali presently have a lot of societies in the middle of redevelopment due to which many homeowners have temporarily taken apartments on rent in the area. Such reasons have been attributed to rental prices climbing by almost 15 per cent. Experts suggest the average rentals have increased by Rs. 5-10 /- per square foot in Mumbai Suburban and By Rs. 10-15/- per square foot in the Island City.

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Redevelopment projects cause rental escalations of up to 15%

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