This rise in prices and flat sizes has been majorly seen in the luxury housing segment while affordable housing continues to struggle.
Residential prices across seven major cities have significantly increased post Covid-19 pandemic, yet bigger homes continue to attract homebuyers. Flat sizes in the top seven cities grew by 32 per cent in the last five years, from 1,145 sq. ft. in 2019 to 1,513 sq. ft. in H1 2024, according to the latest ANAROCK data.
Among all cities, NCR is leading this growth momentum with a 96 per cent surge in the flat sizes.
The COVID-19 pandemic was a boon for the residential markets of Delhi-NCR and Mumbai Metropolitan Region (MMR), due to which demand soared to new heights. Initially, developers induced sales with offers and freebies, but with demand heading north, they gradually increased average prices.
This rise in prices and flat sizes has been majorly seen in the luxury housing segment while affordable housing continues to struggle.
Flat Sizes Grow Across Top 7 Cities
In 2023, the average flat size across the top seven cities was 1,420 sq. ft., which in H1 2024 has raised to 1,513 sq. ft. - showing a 7 per cent jump in the last six months alone. NCR region leads this trend wherein it witnessed a 96 per cent surge in average flat size in the last five years from 1,250 sq. ft. in 2019 to 2,450 sq. ft. in H1 2024.
Says Santhosh Kumar, Vice Chairman, ANAROCK Group, “This significant jump in NCR’s average flat size is largely due to the increased new supply of luxury apartments in the last year. Developers here are responding to the higher demand for spacious luxury homes with appropriate supply.”
While NCR showed the biggest surge in flat sizes, MMR saw the least growth in the average flat sizes in these five years. “The average flat size in MMR rose from 784 sq. ft. in 2019 to 825 sq. ft. in the first half of 2024 - a mere 5 per cent. In this five-year period, only 2020 saw a notable 21 per cent annual rise in the region’s average flat size against 2019. Since 2020, the average size here was the highest in 2022 - at 840 sq. ft. It fell by 5 per cent in 2023 against the preceding year,” Kumar states.
Average flat sizes in the other major southern cities - Chennai and Bengaluru – are 1,450 sq. ft. and 1,630 sq. ft. respectively in H1 2024. Kolkata’s average flat size stands at 1,125 sq. ft. while in Pune, it is 1,103 sq. ft.
Flat Sizes Increase, But Affordable Housing Suffers
Interestingly, in 2019, sales of luxury homes were a mere 3 per cent while the affordable sales share contributed the majority of these at 49 per cent.
As per the report, previously affordable housing dominated NCR’s supply which has been witnessing a steady decline in the last few years. Of approx. 24,300 units launched in NCR in H1 2024 across different budget segments, luxury homes comprised the maximum share of 77 per cent - approx.18,600 units.
According to previous data by ANANROCK, out of NCR's total housing sales of approx. 32,200 units in H1 2024, an over 45 per cent share was in the luxury segment, while the affordable segment docked only 24 per cent.
Noida and Greater Noida together saw approx. 8,425 units sold in H1 2024. Of this, 42 per cent (approx. 3,550) units were luxury homes and just 13 per cent (approx. 1,100) units were in the affordable segment. The highest sales share - 3,770 units or 45 per cent - was in the mid and premium segments priced between Rs 40 lakh and Rs 1.5 Cr.
The report hints that the surge in flat sizes is backed by continued consumer preference and pandemic-specific demand profile. New supply in the (NCR) region has followed demand, with developers adding more supply in the luxury segment and curtailing it in the affordable segment.