Three and a half years after its much awaited deadline, the Mumbai Metro is finally open to the public. Though the first phase of the metro railway link which connects the northwestern suburb of Versova-Andheri with Ghatkopar on the northeastern fringe has just opened, but the real estate in Mumbai has been feeling the effects of the metro for a long time.
All across India, infrastructure developments have preceded massive residential and commercial realty growth where infrastructure works undertaken by government authorities have helped create location-based demand.
In New Delhi, the Metro link to Delhi, the Dwarka Expressway and the Kundli-Manesar-Palwal (KMP) Expressway, opened up new growth areas in Gurgaon and pushed up prices of residential real estate in Gurgaon by almost 30-60%.
Similarly in Mumbai, the property values of localities falling on the Metro route have been on the rise for the past few years. Areas which would benefit from metro connectivity have already seen a price appreciation of 400 per cent over the past eight years, and this trend is set to continue, say recent reports.
Scheduled infrastructure projects tend to increase the value of properties in the adjoining areas that will benefit from them. This occurs because the infrastructure project becomes a part of the USP for the developers or property owners. With the first phase of the metro underway, the residential and retail markets in Andheri, Jogeshwari and Ghatkopar will witness tremendous growth, especially those near the Metro stations. Not only absorption and supply, but even the rental values and capital values in these areas are expected to rise due to the completion of the metro construction and reduced congestion on the roads. Experts believe that even the suburban business districts of Mumbai comprising of BKC, Seepz, MIDC and Powai will experience an immense positive impact with increasing absorption rates.
The Navi Mumbai Metro which has been delayed from 2014 to 2015 has also had a positive impact on the residential demand with property values in localities such as Nerul, Seawoods, Palm Beach, Kharghar and Kamothe increasing the property rates there by almost 24-50 per cent over the past few years.
Experts believe that in Mumbai for the metro to have long term effect, there should be an increase in floor space index of 4 to areas near the metro. It is believed that this it would have a far-reaching impact and could potentially transform the entire landscape of areas surrounding the Mumbai metro.
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