How much real estate can $1 million buy? 113 sq m in Mumbai, 226 sq m in Delhi and 385 sq m in Bengaluru

The city-state of Monaco continued to reign as the world’s most expensive city in 2022 where $1 million would have got you 17 square metres of real estate followed by Hong Kong (21 sq m) and New York (33 sq m), Knight Frank’s The Wealth Report 2023 has said.

In Mumbai, the same amount will buy you 113 sq m, Delhi 226 sq m and Bengaluru 385 sq m, the report released on March 1 said.

Mumbai shinning

While luxury housing prices across the world increased by 5.2 percent YoY in 2022, Mumbai’s prime property market witnessed a price appreciation of 6.4 percent, catapulting the country’s financial hub to the 37th position on the Prime International Residential Index (PIRI) 100 in 2022. It was at 92nd position in 2021.

PIRI 100 tracks the movement in luxury residential prices across the world’s top residential markets.

Prime properties in Mumbai are expected to witness an appreciation of 3 percent in 2023.

“Mumbai ranked second amongst APAC markets, after Tokyo, with 6.4 percent YoY rise in values even as other markets in the region saw declining values,” Baijal said.

Bengaluru’s prime property appreciation by 3 percent moved the city’s position to 63rd in 2022 from 91st in 2021. Delhi’s saw an appreciation of 1.2 percent, which thrust up the national capital to 77th rank from 93rd in 2021.

“India is also one of the few large economies that has continued its growth momentum since the start of the post pandemic recovery, while many other locations face fresh economic challenges,” Baijal said.

Private investors in the lead

According to The Wealth Report, private investors were the most active buyers in global commercial real estate in 2022.

A significant $455 billion was invested, accounting for 41 percent of the total, according to the global property consultancy’s capital flows tracker.

This represents private investors highest share of global commercial real estate on record and is the first-time private investment has piped institutional investment.

Institutions invested a total of $440 billion in 2022, 28 percent below 2021 volumes, but 2 percent above the 10-year average.

By comparison, while private capital investment was down 8 percent from its all-time high of $493 billion in 2021, 2022 was still the second strongest year in history sitting 62 percent above the 10-year average.

Multifamily residential or private rented sector (PRS) was the investment of choice, with US$194.9 billion invested in the segment followed by offices and industrial and logistics combined, the report said.

The US, the UK, Germany, Canada and France were the top destinations for private capital in 2022.

However, of the top 10 destinations, the UK (+1%) and France (+21%) were the only countries to see year-on-year increase in investment from private sources.

The US ($302 billion), Canada, France, Germany and the UK made up the top five sources of private investment, with private capital from France increasing investment by 27 percent in 2022.