Micro-Markets Calling The Shots

For a couple of years, the real estate sector has sustained its growth momentum, especially in the residential segment, owing to the concept of ‘Convenient Living’. The growing population, fast-moving connectivity, and rapid infrastructure have led to further formation & development of micro-markets among various cities in India. As per a research report on ‘India Real Estate’, the residential segment has performed remarkably well, wherein sales across the top 8 cities named Mumbai, NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, and Ahmedabad, has grown by 185% YoY in Q2 2021 and by 67% YoY in H1 2021. Mumbai, known as the real estate capital of India, continues to offer opportunities to many, be it homebuyers or developers. In recent years, the changing work-life balance and ease of accessibility to various infrastructure amenities in Mumbai have attracted a lot of buyers. It has also led to the strong resurgence of micro-markets that are considered as an ideal investment opportunity for developers to lay their hands.

The evolution of Micro-Markets:

With the active consumption of social media, homebuyers have become more aware of various factors that influence their buying decisions. Amidst the pandemic blues, a location that offers better infrastructure and connectivity makes it at the top of a homebuyers’ wish list.

As per the same report, Residential sales in the Mumbai Metropolitan Region (MMR) during H1 2021 were up by 53% Year-on-Year (YoY). Peripheral markets of Central and Western Suburbs had the highest share in sales in H1 2021 with 25% and 20%, respectively. Markets like Borivali, Bandra, Andheri, and Goregaon in Western Suburbs did exceedingly well between 2020 and 2021.

The increased impetus for choosing homes that are well connected with road, rail, water, and airport infrastructure, educational institutes, healthcare facilities and vicinities possessing green surroundings that are less crowded allows a home buyer to shortlist a key micro-market and make an informed decision. With the growth of the various micro-markets homebuyers is now spoilt for choice.

Invest in a home = Invest in a micro-market

Projects that are prudently located that have great connectivity with all the important hubs for convenient livelihood lure the investors to buy a property in these micro-markets. Be it just for investment or for residing in it, understanding the growth potential of a micro-market is of utmost importance. Key locations in the Western suburbs have rapidly developed given the connectivity with domestic and international airports, upcoming metro lines, social and recreational infrastructure. Projects in such micro-markets have always attracted Domestic and NRI investors, offering a steady growth in capital values.

Right Micro-market at the right time

All real estate developers are always on the lookout for areas that have the potential to grow in the future. The decision to shortlist a location is correlated with the ongoing and upcoming infrastructure initiatives in the vicinity. Looking at the needs and demands of the homebuyers, developers are showing a willingness to pump in more capital in land parcels that are aligned with the buyers’ choice.  However, some micro-markets including key areas of MMR are gaining increased attention from top real estate developers.

In the upcoming quarter, developers are aggressively planning their project launches. With the backing from the Indian Government in the recent Union Budget 2022-23, the announcement of INR 48,000 crore for urban housing has encouraged developers and has further infused positivity for the real estate industry.