The average area of residential apartments has shrunk 27 per cent in the past five years in seven major cities as real estate developers seek to reduce the size of apartments to increase profitability, a report said.
The average area of residential apartments has shrunk 27 per cent in the past five years in seven major cities as real estate developers seek to reduce the size of apartments to increase profitability, a report said. The size has reduced mainly on account of rising demand for affordable homes in metro cities and lower GST rates, Anarock report said. The desire in flat buyers to avail government credit subsidy benefits for affordable housing along with reduced overall costs and added benefits is also playing a role in shrinking apartment sizes, it added. “The liquidity crisis, changing buyer preferences, and growing concerns about affordability… have caused real estate developers to rethink the conventional wisdom of ‘bigger is better’, and significantly moderate unit sizes across seven major cities,” Anarock Chairman Anuj Puri said.
The flat sizes contracted in Mumbai Metropolitan Region (MMR), Delhi-National Capital Region (NCR), Pune, Chennai, Bengaluru, Hyderabad, Kolkata by 27 per cent in the past five years from 1,400 sq ft in 2014 to nearly 1,020 sq ft in 2019 so far, the report added. However, NCR has just seen a fall of 6 per cent in the given period in terms of flat size, it also said.
Meanwhile, different sectors of the economy including real estate are reeling under a demand slowdown currently. The government has come up with a slew of reform measures in the last few weeks to boost the sluggish economy. Among the various other measures, Finance Minister Nirmala Sitharaman on September 14 announced a special window worth Rs 10,000 crore for last-mile funding of non-NPA and non-NCLT housing projects. The objective of the government is to ensure completion of around 3.5 lakh unfinished units across the country, Nirmala Sitharaman had then said.