Sizes of newly launched apartments are shrinking but they are becoming affordable simultaneously . Of the over 50,000 mid sized units_one bedroom and two bedroom houses launched across the top eight cities in the first quarter of 2014, most cities have seen a reduction of around 100 sq ft, said a new study.
This reduction has led to average apartment costs dropping by 6%, said a report by global real estate consultant Cushman & Wakefield.
While the average unit size of new launches in most cities has dropped, Noida recorded the sharpest decline of 16% in newly launched home sizes, it said. This has helped control the cost of the apartments in this micro market despite a 17% increase in per sq ft rates. Similarly, Mumbai witnessed a reduction in apartment sizes by 12% contributing to the ease in cost of apartments by 9% over last year.
Other markets that saw unit sizes drop were Ahmedabad at 8%; Chennai three%; Hyderabad at 9%; Pune 6%; and Gurgaon 3%. However in the same period the benchmark pricing of these areas (price per sq ft of new launches) is not disturbed as far as possible. "The ticket prices of these locations have seen a decline to infuse more affordability into the system despite some of the locations witnessing an increase in the average unit price ," it said.
Chennai, Gurgaon and Hyderabad saw an additional push towards creating affordable options as they also saw a decline in prices of new launches, albeit most of these new launches have been in the peripheral or futuristic locations with lower benchmark pricing. These locations are generally price sensitive and driven by end user purchase, making it necessary to meet price expectations.
