Whenever I am on Narayan Dabholkar Road I am taken back four decades and more into the past, to a time when I was a schoolboy. For a few years, we lived as leave-licensees in a building on top of the hill at Napean Road, after Hyderabad Estate and before Godrej Colony, and I often wonder what might have happened if I had had Rs 1 lakh to spare then.
At that time, apartments in that area were going for Rs. 100 to Rs. 400 a square foot. Rents were less than Rs 10 a square foot. The prices have increased five hundred fold since then. For a certain class of people, salaries have also risen, but by a far lower multiple. Some people running businesses, legitimate or otherwise, have made huge profits, but for the most people nothing could have matched investment in real estate.
But that is also a problem. When profits go from normal to supernormal to astronomical for no extraordinary reason except demand and supply that are by all accounts doctored, something must give. So it is hardly surprising that Mumbai is at the bottom of a housing affordability survey conducted by Knight Frank in 63 urban markets globally.
Mumbaikars' attitude to real estate prices, residential and commercial, can be described by two clichés - they prefer to bury their head in the sand about the elephant in the room. We'd like to pretend that the problem doesn't exist. Therefore, as time has passed, prices have continued to rise while sales and rentals have slipped.
This problem is perhaps at its acutest in south Mumbai, where slowly but surely the impossible cost of real estate is killing growth and redevelopment. There is no space for new residential buildings to come up in posh localities or commercial ones in Nariman Point, the once coveted central business district that has lost its pre-eminence with the rise of the Bandra-Kurla Complex.
Companies are slowly disengaging not only from Mumbai but particularly from south Mumbai because office space is so expensive as is housing for their employees. They have to pay three times the house rent allowance to staff whom they relocate to Mumbai from other Indian metros.
I would be surprised if people are not asking themselves, "Why bother?" Intriguingly, the average person will have to spend 300 times what they can earn in a lifetime to buy a house in the city, according to this survey, yet not many are renting homes either. This clearly suggests people are buying a disproportionate number of flats purely for speculative purposes, blocking supply and intensifying the crisis.
Meanwhile, south Mumbai is growing older demographically and remains trapped in this high-price cycle. Areas such as Napean Sea Road, Breach Candy and Malabar Hill seem to be stuck in a time warp. Even trendy retail outlets and eateries are struggling for survival because of the high rents.
Of course, Mumbai has remained vibrant and cosmopolitan so far, which is its great seductive quality, apart from still being able to provide livelihoods and opportunities for business. For people all over India, this city remains an El Dorado. But the promise of a golden, glamorous lifestyle can last for only so long, withering rapidly when the reality is starkly different.
It is not for nothing that Bandra is the most happening part of the city or that the swankiest building complexes can be found in Navi Mumbai and Vashi. 'New Cuffe Parades' are mushrooming all over, in localities such as Sewri, and are in the luxury bracket. The attraction of living or doing business in Mumbai will draw people in as long as the city offers something, but most localities do not offer an attractive quality of life.
Badly made and maintained potholed roads make a mockery of Mumbai's status as the country's leading metropolis. Traffic snarls - virtually 24x7 - add to the frustration and disgruntlement and belie the city's prestige further. But nothing makes it worse than the unaffordable housing for the vast majority.
The scenario seems grim and I am not being original in saying this: the doyen of housing loans in the country, Deepak Parekh, has perhaps been most vocal about the need for real estate prices to be rationalised if there are not to be serious repercussions - economic and social. Every wake-up call contains within it a kernel of hope and a chance to change. Will Mumbai do it?
When he is not following sport, Ayaz Memon writes about the city and its different worlds