New Delhi: Average apartment sizes fell by up to 26 per cent in last five years across seven major cities in the country as developers are making smaller flats to boost their sales in a sluggish housing market, according to global property consultant JLL India.
To beat slowdown in the real estate market, particularly the residential segment, builders are cutting the flat sizes but not reducing the housing prices.
The Mumbai Metropolitan Region (MMR), including Mumbai, Thane and Navi Mumbai, witnessed the maximum fall in apartment sizes on annualised basis, along with Bangalore, Chennai and Kolkata.
Other cities – Delhi-NCR, Hyderabad and Pune – also witnessed a varying degree of fall in median apartment sizes.
“Builders are exploring innovative ways to make residential housing across major cities more appealing to potential buyers at a time when it is increasingly becoming difficult to sell expensive apartments.”
“Around the country, builders are emulating the famous sachet marketing strategy adopted by FMCG companies in the late 1990s,” JLL India chairman and country head Anuj Puri said in a statement.
In its latest research report, titled ‘Is Indian Real Estate Heading Towards A Tectonic Shift?’, JLL India examined the transitions that India’s real estate has undergone over the past decade.
“Among the major trends is how developers have been decreasing apartment sizes to suit affordability of buyers,” he added.
Unable to sell expensive homes in a sluggish market, Mr Puri said builders across India are making smaller apartments without lowering the price per square feet and compromising on the quality of product.
“In the last five years, average apartment sizes are falling across all major cities of India.”
Mumbai, which already had smaller and compact apartment sizes compared to other cities, saw a decrease of 26.4 per cent in the past five years.
Bengaluru registered a 23.7 per cent reduction in average apartment sizes, while Kolkata witnessed 24 per cent cut in flat sizes and Chennai by 22.2 per cent.
Average apartment sizes have reduced by 9.7 per cent in Delhi-NCR and 7 per cent in Pune.
The report said that buyers are increasingly opting for homes that are closer to their workplace in order to reduce commuting time.