Reduction in flat sizes keeps the prices low: C & W report
The slowdown in the real estate sector has hit the sector badly and the developers are now reducing the size of the units to keep the prices low. They are working on the architecture and cutting down on the number of balconies, using the optimum space for living rooms and reducing the wastage of space in alleys and other unusable areas. Reduction in size of approximately 100 square feet became a noticeable trend in over 50,000 mid-segment new houses across eight cities in the first quarter of 2014.
Global real estate consultants Cushman & Wakefield (C&W) has done a study on this trend and has reported that this has resulted in a drop of 6 % in the cost of such apartments. Despite a 17 % increase in rates per square feet in NOIDA, and 9 % in Mumbai the costs of the apartments have come down due to this smart move.
Among the cities, Noida recorded the sharpest decline of 16 % in newly launched home sizes followed by Mumbai at 12 % in size reduction. Ahmedabad has seen an 8 % drop in the size of the apartments, Chennai 3 %, Hyderabad 9 %, Pune 6 % and Gurgaon 3 %.
Apart from that, in line with Modi’s agenda of affordable housing for all by 2022, the builders in Chennai, Gurgaon and Hyderabad have worked onblueprints for feasible affordable options. There is a decline in price of new launches.
Sanjay Dutt the executive MD, South Asia at Cushman & Wakefield mentioned that due to the economic slowdown and inflation, the buyers did not have a corpus to invest in real estate. Hence affordability was the key to lure the customers and the developers have successfully done that.
Source- Financial Chronicle
