Housing Loan Demand : Mumbai Slips Behind Pune, Delhi

India's financial capital Mumbai has fallen by the wayside in the mortgage market rankings as record realty prices keep customers away, say real estate & housing finance executives.

Pune &  New Delhi have overtaken Mumbai with steady demand, while Mumbai has fallen to 3rd or 4th position for housing finance.

Mr. V. Srinivas Rangan, Exeutive Director, HDFC said, "It used to be number one. But there are not many new projects that sell in big numbers. So, most sales are outside Bombay where the value is lower. We are witnessing good volumes from the northern market, especially the NCR (National Capital Region)."

In addition to affordability in the north, Mumbai real estate is seeing a slowdown due to lack of infrastructure and economic slowdown.

With the financial situation worsening over the past couple of years, Mumbai - predominantly a banking & fiancial services oriented region - has lost its position. Apart from unaffordable prices, the dearth of new launches in Mumbai is a key reason for falling sales.

Mr. V.K. Sharma, MD and CEO, LIC Housing Finance said, "Lending in Mumbai has come down. Prices have shot to unsustainable levels. The real estate market is under stress. New projects are not coming up and existing ones are getting delayed. Also, with prices at this level, expectation of returns has also fallen."

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