Property Prices Double in Chembur, Wadala Due to Monorail

Even before the Mumbai monorail becomes operational, property prices in Chembur and Wadala have at least doubled in the last 4-5 years. The first line of Mumbai monorail between Chembur and Wadala has a huge impact on property prices in these areas.

The Mumbai monorail

The Mumbai monorail project in India is the first monorail project in India since 1920s. It is being constructed as a part of expansion of Mumbai’s public transport system. The Mumbai Metropolitan Region Development Authority (MMRDA) is building the project in association with a consortium of Larsen & Toubro (L&T) and Scomi Engineering, a Malaysian infrastructure firm. The monorail is expected to connect the eastern suburbs of Mumbai to the western suburb and reduce commute time.

The first line of the Mumbai monorail is being built between Chembur and Wadala, and is 8.8 km long. The construction started in January 2009 and the line was supposed to be operational from September 2013. However, delays due to technical difficulties and safety issues have delayed the commencement of its operations.

Reasons for price appreciation

There are various reasons quoted for an enormous increase in property prices in these areas. The western suburbs are already expensive in Mumbai with the current infrastructure and amenities. Better connectivity with the western and the southern suburbs due to the monorail is one of the reasons for price increase in the eastern suburbs. Another reason which has further catapulted the prices in eastern suburbs such as Chembur and Wadala is the Eastern freeway and the proximity to the Eastern Express Highway.

However, experts also opine that along with these reasons, another major reason for exorbitant surges in property prices in these areas surrounding the monorail is the hype and anticipation. They say that some people with vested interests who can make profits in these areas over-hype the prices. Properties lying along the monorail line are not the only areas seeing price hikes. Catchment areas such as Ghatkopar, Kurla and Sewri are also seeing increased property prices.

Price trends

The following price trend gives an idea about how property prices have increased in areas such as Chembur, Wadala, Ghatkopar and Sewri since the monorail project was announced. Capital value in Wadala was at an average of Rs. 9,700 per sq.ft and Rs. 8,200 per sq.ft in Chembur before January 2009 when the construction began. Within a year after the construction of the first line commenced, the average price per sq.ft in Wadala rose to Rs. 16,100, an increase of 66% and Rs. 10,200 in Chembur, an increase of 24%. Surrounding areas such as Sewri and Ghatkopar also saw a reasonable increase in property prices. Capital value in Ghatkopar rose from approximately Rs. 6,500 per sq.ft to Rs. 13,100 per sq.ft (an increase of 101%) and from Rs. 16,600 per sq.ft to Rs. 21,000 per sq.ft (an increase of 26.5%) in Sewri.

The capital value during the second quarter of 2013 in Chembur is approximately Rs. 15,500 per sq.ft and Rs. 20,150 per sq.ft in Wadala. This is an increase of 89% and 107% in these two areas respectively in the last 4 years. Similarly, capital value during the second quarter in Ghatkopar was approximately Rs. 15,500 per sq.ft and Rs. 31,100 per sq.ft in Sewri. This is an increase of 138% and 87% respectively in the last 3 years.