The next big real estate battle: Thane or Navi Mumbai?

The moment a real estate developer uses words like ‘saleable area’, ‘built-up area’ or ‘super built-up area’, my mind now automatically switches off. Irrespective of the brand or offering–I lose complete trust on the developer.

My principle is simple: If one can’t follow the terminology (carpet area) that is legally binding to a regulator at the time of a sales pitch, it is unlikely that the developer will oblige his commitments to an individual home buyer. Armed with this background, I opted to explore the Navi Mumbai real estate market last week. Why Navi Mumbai? Simple — one of the consequences of the COVID-19 pandemic has been a significant surge in Work from Home (WFH) for select roles and professions. But WFH will not mean a home in places such as Patna, Raipur, Ranchi etc where internet connectivity or electricity may be patchy. The ‘home’ will in all likelihood be close to the main city where a visit once or twice a week to the office will be doable. That allows companies to save on commercial space costs and employees to save on expensive rentals or home purchases of the metro cities. 


Navi Mumbai is that exception wherein the quality of administration outshines that of the real estate developers. Far from perfect, the basic infrastructure is reasonably well groomed in terms of roads, water, drainage etc. The social vibrancy however is missing to the point that it can almost be considered sleepy – an attribute that will make WFH from even small towns be a dampener. In the real estate sphere with the exception of one large branded developer—L&T and one ambitious upstart Adhiraj Constructions—the others are local and display those standards. (Although Hiranandani Developers did do one of its lesser impressive projects in 2003 in that market and Godrej is intending to do one soon).

As most of these local players use terms like ‘saleable area’ and ‘built-up area’, I will ignore giving them a mention. Those two phrases have been so severely abused that they arguably constitute the most audacious heist committed in real estate. The very fact that this practice continues in an area next to Mumbai says a lot about the level of introspection within the developer community.

The problem with considering real estate options in Navi Mumbai rest on two pillars:

1) Connectivity: The connectivity to central Mumbai is weak. The impact of the upcoming TransHarbour link or the Metro is tough to ascertain but it has already elevated prices disproportionately.

2) Prices:  Unlike Mumbai where rates have fallen, there has been no meaningful correction in Navi Mumbai yet due to the supply being largely controlled. That has meant rates today are equivalent to many thriving suburbs of Mumbai. Prices at prime locations like Palm Beach road are actually at levels that will make even Vikas Oberoi, the promoter of Oberoi Realty, smile.


The other market that is geographically close to Mumbai is Thane. In many ways, Thane is almost the exact opposite of Navi Mumbai.There is perhaps no location in India today which has as many large branded developers with major townships slugging it out against each other as Thane. That has meant the practices followed by developers in Thane are far ahead of those in Navi Mumbai. Housing prices are more affordable in Thane. Prices in premium constructions at good locations in the city are 30-40 percent lower than their peers in Navi Mumbai. With the added benefit of superior connectivity and a vibrant social infrastructure, the location has become the choice of professionals looking for a home. Data from CRIF High Mark, a credit bureau, shows that there are more active home loans outstanding in Thane than in Mumbai as of December 2019: 5,82,613 vs 5,41,892.

With these strengths it would be easy to infer Thane as the winner of the Mumbai exodus. Only it is not as simple.Large townships and commercial activity bring the necessary upgradation requirements in supporting infrastructure and in this regard, I never underestimate the capacity of political parties in ruining a city. The annual budget of Thane Municipal Corporation is almost Rs 3,800 crore but seeing the crumbling infrastructure – no one can tell. The former boss of TMC, T Chandrashekhar, gave Thane a robust foundation two decades ago but it is rapidly withering away.

Can it upgrade? Honestly – I don’t know.


Eventually it boils down to what a person wants from a particular location. Thane is preferable from a connectivity and vibrancy perspective while Navi Mumbai is appropriate from an infrastructure and quality of life perspective. As real estate rates continue their fall in Mumbai and alter the benchmark price, even these two cities will see a price drop. Navi Mumbai may hold up better than Thane due to its controlled supply and superior infrastructure.

Thane, however, has an opportunity and a learning from Mumbai: Don’t plunder and kill the hen that lays the golden egg. Instead nurture it wisely. If it can do that successfully – Thane can win this battle of alternative Work from Home hubs.

Source: Publication: Moneycontrol ,25th August 2020