Property prices are still on the rise in 2023, but the demand for larger homes persists, according to a report by real estate company Anarock Group.
The demand for bigger homes in India’s cities continues to grow despite rising property prices, according to a report by Anarock Group. The average flat sizes in the top-seven cities rose by 7 per cent in the last five years
Property prices are still on the rise in 2023, but the demand for larger homes persists, according to a report by real estate company Anarock Group.
The average flat sizes in India’s seven major cities have witnessed a 7 per cent growth in the last five years, reaching approximately 1,225 sq. ft. in Q1 2023 from around 1,150 sq. ft. in 2018. However, Mumbai Metropolitan Region (MMR) stands as an exception with a 20 per cent reduction in average flat sizes.
In 2022, the average flat size in these cities stood at 1,185 sq. ft., as against 1,170 sq. ft in 2021. The seven cities named in the report are: Delhi National Capital Region (NCR), Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad and Pune.
Mumbai Metropolitan Region (MMR) is the only city where the average flat sizes reduced in the last five years – from 932 sq. ft. in 2018 to 743 sq. ft. in Q1 2023. In these five years, only 2020 saw average flat sizes in MMR annually increase by 21 per cent against 2019.
City-Wise Data
Among the top-7 cities, NCR saw the highest growth in average flat size in the last five years – from approx. 1,250 sq. ft. in 2018 to approx. 1,700 sq. ft. in Q1 2023. Developers in NCR are closely tracking demand and launching bigger homes in this region, the report said.
At present, Hyderabad has the largest average flat size, which is around 2,200 square feet. The next highest average flat size is in Delhi NCR, at approximately 1,700 square feet.
Chennai and Bengaluru have average flat sizes of around 1,175 and 1,300 square feet, respectively, while Pune has the smallest average flat size at 1,013 square feet.
Anuj Puri, chairman, Anarock Group said that before the COVID-19 pandemic, apartment sizes were shrinking annually to cater to the demand for compact and affordable homes, driven by the preference of millennials for low-maintenance residences. However, there was a sudden shift in buyer preferences in 2020 due to the work-from-home and study-from-home culture, leading to an increase in flat sizes. In 2023, property prices are heading north, but the demand for bigger homes continues, the report says.
Trend In 2023
In the first quarter of 2023, the average size of flats in the top-7 cities increased by 5 per cent compared to the previous year. Delhi NCR had the largest increase of 50 per cent, followed by Kolkata with 44 per cent, and Hyderabad with 29 per cent. The average flat size in NCR now stands at 1,700 sq. ft.
Pune had a 16 per cent increase, Bengaluru had an 8 per cent increase, while Chennai and MMR saw decreases of 6 per cent and 5 per cent, respectively.
Developers feel that the peculiar decrease in flat size in Chennai and MMR is because there is currently sufficient existing supply of larger format homes in these cities. Also, while MMR is hyper-expensive, Chennai is a very cost-sensitive market. In both instances, increasing the supply of smaller, more affordable homes makes sense, the report said.