Click to play videoMumbai: The Maximum City is bursting at the seams and along with the average Mumbaikar, the high-end customer is also facing the heat in his quest for an upmarket flat in a swanky area.
In fact a recent report by HR body ECA International suggests that Mumbai is the seventh most expensive city in the world for an expat manager looking for top class housing.
The study compared rental prices for unfurnished three bedroom apartments in prime locations and found that Hong Kong is the costliest at a huge $8600 per month, Tokyo is second at $7360 and Mumbai takes the seventh spot at $5500 per month.
"When compared with other cities with practically no FSI, Mumbai has FSI of around 1.3 which is restrictive. Also the urban land ceiling act has not been repealed which is blocking land further. All of these restrictions are pushing up prices further,” says Deputy MD, Cushman & Wakefield Sanjay Dutt.
Other experts also blame the rising rupee and say at least a part of the upsurge in prices on the Indian currency which has moved up by 10 percent in the last year is responsible for the surge in prices. So in a dollar denominated survey, Mumbai has jumped a few ranks.
"The rising rupee is also an important factor. Mumbai has been at lower rank when rupee was at 48 (compared to the dollar),” says Chairman-Knight Frank Pranay Vakil.
The state government's long announced plans of repealing the urban land ceiling act have so far come to nought and unless the act is scrapped chances of land opening up for development will remain slim.
And unless this happens, there is very little that can cool the overheated rental market for upmarket properties.
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