Scrapping of development plan to hit home supply in Mumbai

Most await clarity regarding the new plan

The Maharashtra government’s move to scrap the draft development plan for Mumbai and its revising could hit supply of new housing projects. This would push up property prices in the country’s commercial capital.

Gulam Zia, executive director at Knight Frank, said the confusion in the new plan will delay new projects by at least one year. “Those projects, which are to come up in three years from now, will not come up and supply will be hit. As a result, prices will shot up,” Zia said.

He said developers would not put up new proposals till the row is settled and government officials will also be under confusion regarding clearing of new projects.

Ashutosh Limaye, head – Research & Real Estate Intelligence Service, JLL India, said until the revised development plan is tabled, the current uncertainty will continue.

“Developers will wait to study the proposals and their implications before launching new projects. In the meantime, supply of new units might drop, and this will help in clearing the existing unsold inventory to some extent,” Limaye said.

He added buyers should assess their needs well to decide if they should buy from the projects available now, or if they can wait until clarity emerges via the new DP.