Kolkata / New Delhi, Oct 22 (FN Bureau) Demand for affordable homes has nosedived since Covid-19, initially because this segment’s target clientele was financially impacted by the pandemic. However, the ANAROCK-FICCI Homebuyer Sentiment Survey – H1 2024 has identified other points as at least 53 percent of homebuyers are dissatisfied with the currently available options in this vital segment across cities. “ The top three reasons why prospective affordable homebuyers are disenchantment with the currently available affordable housing supply are bad project location accessibility, questionable construction quality, poor design, and constricted unit sizes. Of the dissatisfied affordable home seekers polled in our survey, a whopping 92 pc respondents identify project location as the biggest grouse, while 84 pc state low construction quality and inferior design elements as major deterrents. 68 pc respondents find the available unit sizes too small to be attractive.”
Chairman of ANAROCK group Anuj Puri said. Declining demand for affordable housing has had a cascading impact on its supply in the last year. The data highlights the shrinking supply of affordable housing in major cities, dropping from 26 pc of total launches in 2021 to just 17 pc by 2024. Before the pandemic in 2019, affordable homes made up 40 pc of new projects. “Bigger homes continue to dominate buyer preferences despite spiralling prices in the last year,” said Puri. “Over 51 pc of the current survey respondents prefer 3BHK units and just 39 pc will settle for 2BHK options. City-wise analysis indicates that the demand for 3BHKs is particularly high in Chennai, Hyderabad, Delhi-NCR, and Bengaluru, where over 50 pc respondents prefer it over other flat sizes. Conversely, over 40 pc participants in Kolkata, MMR and Pune name 2BHKs as their preferred option.” In terms of preferred stages of construction, the H1 2024 survey shows a significant trend reversal.
The demand ratio of ready-to-move-in homes to new launches now stands at 20:25. In H1 2020, the RTM-to-new launches demand ratio was 46:18. One major reason for this shift is that most homebuyers favour projects by large and listed developers, who they are confident will deliver their homes on time. Another key highlight of the H1 2024 survey is that at least 57 pc residential real estate investors are focused on steady rental income. This is far from surprising, since there has been a remarkable surge in rental rates across cities in the last two years (over 70 pc in prominent micro markets). Rental earning potential has therefore taken centre-stage as an investment motivator. While interest in the currently available affordable housing supply continues to decline, premium and luxury homes continue to dominate demand – at least 45 pc survey respondents now prefer homes priced >INR 90 lakh. In the survey’s pre-Covid 2019 edition, just 27 pc respondents were interested in properties in or above this price bracket. The latest survey also identifies a growing preference for residential plots, which 20 pc of property seekers name as desirable options across cities. City-wise data highlights that this preference is most pronounced in the major Southern cities – 30 pc buyers in Chennai prefer it, 29 pc in Bengaluru, and 27 pc in Hyderabad. Several large and branded developers have launched residential plot projects in these cities over the last few years and continue to find ready-takers. Villas and row houses are also markedly in demand in these southern cities. Contrastingly, more than 70 pc survey participants in MMR, NCR, and Pune prefer apartments.