In India’s big cities, new homeowners are not ready to settle for smaller houses. The demand is on the rise for big, premium and luxury houses, according to data.
Analysis of the data by real estate data analytics platform Propequity and real estate services company JLL shows that Indians in tier 1 cities like Delhi, Mumbai, Chennai, Kolkata, Pune, and Bengaluru increasingly prefer houses in the premium and luxury segments. Increasingly more of them prefer a house with three or more bedrooms.
In the third quarter of 2023, 38 per cent of the new homeowners in tier 1 cities bought a house that has three or more bedrooms. In the corresponding period in 2022, their share was 35 per cent. It was as less as 29 per cent in Q3 2020.
As the demand for bigger houses is rising, the demand for a one-bedroom house has been coming down drastically. For instance, in Q3 2023, less than a quarter of the new home buyers in tier 1 cities bought a 1 BHK house. In 2020, around one-third of home buyers wanted 1 BHK house.
This was also noted by ANAROCK Property Consultants in one of their reports earlier this year. It noted that the average flat sizes in the top seven cities increased by 7 per cent in India. This could be because of an increase in work-from-home jobs.
Luxury on the cards
New homeowners in big cities also like to dabble in comfort. JLL’s data shows that the demand for premium and luxury apartments has gone up quite a bit in the country.
The report noted that the proportion by which sales are increasing in the luxury segment is significantly higher compared to that of mid-segment apartments. Sales grew by 37 per cent y-o-y in case of luxury segment in H1 2023, according to JLL’s residential sales report. While 18 per cent of the new homeowners in the first half of 2022 preferred apartments in the luxury category, their proportion went up to 21 per cent in H1 2023.
PropEquity’s data suggests that this trend is driven by the big city dwellers. In NCR, 29 per cent of the new homeowners in Q2 2023 preferred premium apartments and 28 per cent preferred the luxury range. In Hyderabad, people who bought houses in these two categories together formed 55 per cent. In Mumbai, it was a whopping 59 per cent.