The ‘bigger is better’ mantra continues to drive the Indian housing market. The FICCI-ANAROCK Consumer Sentiment Survey (H2 2023), unveiled at the FICCI Real Estate Summit in Delhi today, finds that the highest homebuyer demand is now for 3BHKs, with at least 50% respondents picking this size. 38% respondent favour 2BHKs. The demand for 3BHKs stood at 42% in in the H2 2022 edition of the survey.

Despite increasing property prices, the demand for bigger apartments continues unabated and is, in fact, increasing. 3BHKs are particularly in vogue in Bengaluru, Chennai, Hyderabad, and Delhi-NCR. In hyper-pricey MMR, 44% of respondents preferred 2BHKs. The demand for 1BHK units is being primarily evident in the western markets of MMR (17%) and Pune (10%).

Aligned to the growing preference for bigger apartments, the demand for luxury homes priced >INR 1.5 Cr has also gained more traction. At least 20% of the H2 2023 survey respondents prefer to buy homes in this price bracket, against 12% in H2 2021. The INR 45-90 lakhs budget range remains the most popular, with over 33% prospective homebuyers favouring it.

Affordable housing demand has shrunk further, to 21% in H2 2023 from 25% in H2 2021, and 40% in H2 2020.

Anuj Puri, Chairman – ANAROCK Group, says, “The supply of bigger homes is seamlessly following the demand for them. ANAROCK data indicates that average flat sizes in the top 7 cities grew by 11% annually last year – from 1,175 sq. ft. in 2022 to 1,300 sq. ft. in 2023. The survey also finds that for the first time, the demand for ready-to-move homes is lower than new launches. The survey highlights that in in H2 2023, the ratio of ready homes to new launches is 23:24 against 32:24 in H2 2021. Interestingly, it stood at 46:18 back in H1 2020.”

The survey further highlights the growing inclination of homebuyers towards suburban areas and city centres, in line with the return to office (RTO) dynamic being witnessed post the COVID-19 pandemic. 30% of respondents in the current survey (H2 2023) chose suburban areas as their first choice for buying a home, against the 25% who preferred suburban areas in H2 2021.

The current survey also finds that:

• No less than 75% property seekers now want balconies. The desire for more open spaces within homes is a significant change from earlier years, when the focus was more on dedicating almost every square inch for indoor utilization.+ 
• 74% of the surveyed homebuyers insist on improved construction quality.

Other Key Survey Highlights

• 58% millennials & 39% Gen-X respondents intend to use their gains from other investments to purchase homes
• While real estate remains the most preferred investment asset class for over 57% respondents, there is also a growing sentiment towards Fixed Deposits (FDs) in the wake of rising interest rates
• More investors are now backing residential real estate – in H2 2023, about 36% prospective buyers will purchase properties as investment
• Over 73% survey respondents state that their home buying decision will not be impacted if home loan rates stay below 8.5%
• Inflation is not impacting disposable income as much as it did in the previous year’s survey – in H2 2023, 55% participants felt a notable impact of inflation, down from 61% in the H2 2022 edition

Also Read: Mumbai Coastal Road: A catalyst for real estate growth in Western Suburbs

The post 3BHKs Lead the Market   appeared first on Square Feat India.

As per the CII-ANAROCK Consumer Sentiment Survey – H1 2022, demand for 3BHKs has outstripped that of 2BHKs for the first time. At least 44% of respondents preferred 3BHKs, followed by 38% favouring 2BHKs. In the survey’s H1 2021 edition, 46% preferred 2BHKs, and 40% voted for 3BHKs. The demand share for 4BHKs has also risen – from 2% in the pre-Covid survey to 7% now.  The survey, conducted between January and June 2022, polled 5,500 participants responding via various digital platforms.

This is even more significant considering that the survey also highlights high inflation as a major cause of concern for respondent homebuyers. 61% declared their disposable incomes as ‘majorly impacted’. Most survey participants (92%) predict that the economy will either stay at current levels or marginally improve over the next 12 months. In the H1 2021 survey, respondents were more bullish about the economy – at least 16% expected it to improve significantly over the next one year.

“The demand for homes priced >INR 1.5 Cr continues to grow,” says Anuj Puri, Chairman – CII Real Estate Knowledge Session on Tapping the Consumer Beat and Chairman – ANAROCK Group. “Compared to the pre-Covid 2019 survey, there has been a 4% rise in the vote share for thesehomes – from 6% pre-Covid to 10% in H1 2022. Buoyed by the increasing demand for luxury homes, developers have also significantly increased the newsupply in this category in H1 2022. ANAROCK data reveals that 33,210 units priced INR 1.5 Cr and above were launched across the top 7 cities in H1 2022. Contrastingly, H1 2019 saw just 16,110 units launched in this segment.”

“The pandemic effect on home sizes continues – larger spaces in non-core urban areas remain in higher demand across the top cities. The reopening of offices and schools has changed little about this trend – as the increasing demand for the 3BHK configuration over 2BHKs vouchsafes,” says Puri.

Interestingly, investors with an 8–10-year investment horizon have the most positive outlook in H1 2022. More than half of respondent investors feel that the current housing market is a better investment proposition than it was 12 months ago. The survey also highlights that while ready-to-move homes still draw top buyer demand, the demand gap between ready and under-construction options continues to narrow. The ready vs. new launch demand ratio is 30:25 in the H1 2022 survey, while it was 46:18 in the H1 2020 edition.

Other Survey Highlights

• Preference for real estate over other asset classes is growing. In the H1 2022 survey, 59% of respondents prefer to invest in real estate, against 54% last year
• Buying homes with capital gains from other investment asset classes like the stock market and mutual funds is the top priority for millennials and Generation X – with 56% and 38% respectively voting in its favour
• The residential market remains dominated by end-users, with 69% of respondents looking to buy homes for self-use and 31% for investment
• Newly-launched properties gaining traction – 25% of respondents now prefer new projects as against 18% during the 1st Covid wave survey (H1 2020)

Also Read: Survey of dilapidated buildings hampered due to Covid

The post 3BHKs in Highest Demand  appeared first on Square Feat India.