Larger homes still in high demand

Hyderabad: While the Covid-19 pandemic has rebooted the desire for 'hard assets' like housing, certain housing types are selling better than others. The fact that buyers are spoiled for choice allows them to pick and choose.

Home buyers' focus has clearly shifted from affordable housing (homes priced under Rs 40 lakh) to mid-end (Rs 40 - 80 lakh) and high-end homes (Rs 80 lakh to Rs 1.5 crore) as per real estate consultancy Anarock's most recent sales figures on transaction data from the larger market.

This is very evident from analysing buyer behaviour in the top seven cities in the last fiscal year FY22 - nearly 80 per cent of demand is for mid-end and high-end homes, with the affordable housing segment accounting for a mere 10 per cent of the demand. Description automatically generated with medium confidence Rahul Phondge, Chief Business Officer, Anarock Group, says, "Chennai and Pune showcased the highest demand in the mid-end segment and accounted for nearly 60 per cent and 59 per cent of the total demand in these cities. Bengaluru recorded almost 56 per cent of demand geared towards the high-end segment.

Of the city' overall housing sales, Hyderabad displayed the highest demand for luxury (17 per cent) and ultra-luxury (8 per cent) segment homes priced above Rs 2.5 crore. While average prices in Hyderabad are much lower than in the Mumbai Metropolitan Region (MMR), property sizes in these segments are significantly larger than in MMR."

Across the major cities, the 2 and 3 BHK typologies yielded the maximum demand, accounting for 64 per cent of the overall demand. 2 BHK units are most popular in Chennai, where nearly 67 per cent of sales during the fiscal year were for this configuration. Bengaluru sold the most 3 BHK units, which accounted for 49 per cent of overall sales during the year, closely followed by Hyderabad with 44 per cent.

In Delhi-NCR, 4BHK+ and plots stole the show. The preference for independent and low-density living resulted in 4BHK accounting for 17 per cent of sales, and plots accounting for 16 per cent during the fiscal year. The region also witnessed 16 per cent of the overall demand in 1RK/Studio category homes at the other end of the spectrum. End-users accounted for 93 per cent of transactions, with two-thirds hailing from the service class.

Due to MMR's urban sprawl and hectic market activities in peripheral locations, the demand for mid-range and high-end homes dominates. Mid-range housing accounted for 46 per cent of overall demand during FY21-22, while high-end homes accounted for 39 per cent. The preference for 2BHK units is rising, accounting for 50 per cent of the demand. The prospect of future price appreciation is also attracting investors, with approximately 13 per cent of buyers clearly stating that they are investing for the long-term.