REDUCTION IN FLAT SIZE TO MAKE AFFORDABLE

Developers have cut the sizes of newly launched homes by about 100 sq ft which has made the total apartment cost cheaper by an average 6 per cent in the country's eight major cities, according to property consultant Cushman & Wakefield. Noida recorded the sharpest decline of 16 per cent in the sizes of newly launched homes out of eight cities -- National Capital Region (Gurgaon and Noida), Mumbai, Pune, Kolkata, Ahmedabad, Chennai, Bangalore and Hyderabad. Housing prices appreciated by 17 per cent in Noida in last one year, still the total price of the flat came down by 2 per cent due to reduction in sizes of apartments. "The reduced apartment sizes in new launches in 2014 have contributed to making prices more affordable," Cushman and Wakefield said in a statement. In the over 50,000 units (1 and 2 BHKs) of newly launched homes across top eight cities during the first quarter of 2014, most cities have seen a reduction in sizes of about 100 sq ft. "This has led to an average drop of 6 percent in cost of the apartments within these cities." "Similarly, Mumbai witnessed a reduction in apartment’s sizes by 12 per cent contributing to the ease in cost of apartments by 9 per cent over last year," C&W said. Other markets that saw unit sizes drop were Ahmedabad (8 per cent), Chennai (3 per cent), Hyderabad (9 per cent), Pune (6 per cent) and Gurgaon (3 per cent). However, markets of Kolkata and Bengaluru were exceptions to this trend where both unit sizes of apartments as well as the per square foot rate have increased. Correspondingly, the cost of apartments have also increased by 18 per cent in Kolkata and 7 per cent in Bengaluru. C&W Executive Managing Director South Asia Sanjay Dutt said: "Residential sector is banking on end-user driven demand and hence developers are tweaking products to make them more affordable". Reduction in sizes also signals a degree of stress among developers, which is forcing them to launch products to show boost sales numbers into their balance sheets, he said. "Affordability holds the key right now; end-user buyers have been shying away from making purchases for a long time owing to lackluster economic conditions and resultant low confidence," Dutt said.