By Uttara Nilawar
The Mumbai residential market is rife with the concept of ‘Compact Housing’ with several developers launching homes in the range of 350 – 500 sq ft and ticket sizes starting from Rs 60 lakh and going up to Rs 90 lakh, depending on the location of the project. These projects are being launched at Goregaon, Malad, Kandivali, Kanjurmarg, Chembur, Mulund – all prime locations in the Mumbai Metropolitan Region (MMR). Although these apartments are gaining popularity and developers are claiming to sell almost half the apartments on the day of the launch, can these housing units be really termed as affordable? Homes with an area lower than 500 sq ft and price range of Rs 35-50 lakh are usually termed as affordable homes.
The idea of compact homes evolved in the West; these were homes that are usually smaller in size but smart units furnished and equipped with modern amenities, multifunctional transforming furniture and adequate security systems. In several western cities such as Paris, Tokyo, Hong Kong, New York, the concept of compact homes entails a micro home designed to utilize the available space in a smart and efficient manner with the use of multifunctional furniture and smart devices. This concept has not arrived in India yet and the so-called compact homes in cities like Mumbai are limited to small sized, slightly cheaper apartments at prime locations. There are rarely any smart home features in these projects.
The ‘Housing for All, 2022’ initiative was launched by the government to provide affordable homes to the common man but the concept is lost in a city like Mumbai where real estate prices are soaring through the roof. In Mumbai, affordable housing units with the ticket size of Rs 50 lakh are mostly available in peripheral locations such Karjat, Badlapur, Vasai-Virar, Ulwe, Taloja. These locations offer decent affordable apartment choices in terms of size as well as price, but connectivity and adequate physical and social infrastructure remain an issue. Nevertheless, some developers are planning to launch affordable housing projects at these locations. For example, Sunteck Realty, known for premium residential projects, is going to form a new vertical with an investment of up to Rs 10 billion. This new vertical will focus on affordable housing projects at peripheral locations in Thane, Kalyan and Navi Mumbai.
There are a handful of developers who have launched affordable housing projects within the MMR limits as well. For example, Xrbia Developers and Crystal Group tied up together to launch an affordable housing project in Chembur with 1 BHK units ranging from 180 to 230 sq ft, which will be priced at Rs 40 lakh. On the other hand, 2 BHK units which will have carpet area sizes of 305 sq ft will be priced up to Rs 80 lakh.
Though several projects are claiming to be affordable, buyers are still unable to find good-sized affordable apartments at prime locations in Mumbai. As land is an expensive resource at these locations, developers are unable to obtain fair profit margins through affordable housing projects. Project launches in the name of compact housing are also many in number and but it is not a financially viable option for the common man. Affordable housing still remains a distant dream for the common man in Mumbai for which the government and developers must come together to make this dream a reality.
(The author is Manager-Research, Colliers International India)