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Property prices in Mumbai set to increase 20%

 

Mumbai home prices could rise by 15 to 20 per cent every year over the next five years due to heavy demand from buyers, shows a new study by a unit of ICICI Home Finance.

The study revealed, though residential transactions had been slow, a pick-up had been noted over the previous financial year and prices in Mumbai might continue to see an upward trend over the one-year period and grow in double digits in the next five years, says the report by ICICI Property Services.

"This is mainly due to the hesitant buyer now taking the decision to purchase, as the hope of a correction in real estate prices has faded," the report said.

"More, some builders have offered an attractive 20:80 scheme, which has revived transactions in the market," the report said. In a 20:80 scheme, developers absorb pre-installment charges."

Overall, residential real estate prices are likely to remain firm on the back of increasing input costs to developers, coupled with supply slowing due to the slow process of approvals and limited land availability in Mumbai, the report said.

Courtsey: Business Standard