Demand spikes for smaller apartments

AHMEDABAD: Bigger is no longer better. Cash-strapped buyers in Ahmedabad seem to have renewed the market for one and two bedroom apartments.

A stagnant market and high interest rates on home loans is making developers take serious interest in planning small-sized residential projects, rather than luxurious projects.

Neeraj Tomar, head of Ahmedabad operations at Jones Lang LaSalle, said: "Real estate prices have soared beyond the budget of many buyers. So, builders have reduced the size of the apartments."

Developers are focusing on smaller, well-designed apartments to cater to the rising demand, mostly from first home-buyers. "Most of these buyers are under the age of 30 years, who are buying a house for the first home. Such schemes have come up in the industrial areas of Sanand, Vatva and other places in and around the city. There is a lot of sentiment attached to real estate as property gives appreciation. So, there are a set of young investors, who are counting on such schemes," Tomar added.

According to Mihir Desai, a builder who will launch his one and two bedroom project near Gota in July first week, the trend has caught up because the spending capacity of people has not grown as fast as the market since 2010.

"Most builders were launching three bedroom projects after 2010. But developers are now taking note of the fact that there is a growing segment of buyers for smaller apartments through the salaried and newly-married. Besides, investors are wary of the present market conditions so such schemes are being launched keeping the end-users in mind," said Desai.

Apartment sizes are shrinking with developers focusing on making the dream of owning a home true. Parag Gathani, partner, Re/Max-Gujarat and Maharashtra, said: "Until about a year ago, most could not afford to buy a house in Ahmedabad as the schemes were grand and the prices had skyrocketed. However, a huge amount of the population, whose income has grown in the last two years, can now look forward to owning a home."

The super built-up area of an average two-bedroom apartment is sized in the range of 950 square feet and 1,350 square feet while a one-bedroom apartment is available in the size range of 630 square feet to 850 square feet. "A one-bedroom house is available in the range of Rs 9 lakh and Rs 18 lakh while a two- bedroom house starts at around Rs 18 lakh and can be bought for under Rs 35 lakh," added Gathani.

Source: articles.timesofindia.indiatimes.com