A new trend has been visible in the Indian real estate market with major cities seeing developers lowering apartment sizes by roughly 15-17% over the last 2 years. This information was confirmed through the report released by SquareYards, the biggest new home marketplace in the country. The trend is dominant across India’s top 7 cities, namely Gurgaon, Mumbai, Bangalore, Kolkata, Chennai, Pune and Noida. However, the trend has not been observed in case of Hyderabad as per SquareYards. The overall saleable area is coming down for apartments but the carpet area is going up as the percentage of the saleable area.
The Founder & CEO at SquareYards, Tanuj Shori, stated that residential units in India had some concerns relating to mismatches in asset prices and hence developers are now taking this into consideration. They are now coming up compact apartments with lower sizes, thereby making them more accessible and comparatively affordable for customers. He added that saleable area has been lowered and more space is actually available for buyers with innovation being employed by developers.
RERA has put the focus sharply on carpet area and this has made developers more efficient according to Tanuj Shori. He also stated that price and space based optimization will be a continuing trend in Indian real estate. Mumbai is at the top of the pile in this regard with average saleable areas lowering to 809 sq. ft. for 2 BHK apartments as compared to 1,084 sq. ft. in 2017-18. This indicates a drop of almost 25% in apartment sizes. Saleable areas have come down from 1,265 sq. ft. for 3 BHK apartments in Mumbai on an average from 1,710 sq. ft. earlier which indicates 26% of reduction.
However, carpet area is going up across apartments for both 2 and 3 BHK apartments since this is being scaled up as the percentage of the overall saleable area as per several developers. Pune is at number two in terms of the quantum of size reduction. Average saleable areas have reduced to 867 sq. ft. over two years in case of 2 BHK apartments as compared to 1,074 sq. ft. previously which indicates a reduction of 19% in apartment sizes. The drop in flat sizes has been 26% in case of 3 BHK apartments in Pune where average sizes have reduced to 1,323 sq. ft. from 1,799 sq. ft. earlier.
Square Yards is a technology-enabled, global real estate aggregator and India’s largest player for primary residential real estate. It’s subsidiary Square Capital is one of the largest marketplace for secured mortgages in India. Square Yards platform offers an integrated consumer experience & covers the full real-estate journey from search, discovery to research, transactions, home loans and post-sales service – fully integrating buyers to an extensive network of 500+ partner real estate developers, and 90+ banks & NBFCs. Square Yards is led by accomplished professionals, ex-bankers, and Ivy school alumni and is backed by the competence of more than 2500 employees in 30 cities and ten countries.