59% Indians prefer mid, high-range homes despite price rise: Anarock

Mid-range homes, priced between Rs 45 lakh and Rs 90 lakh, are the most preferred

59 per cent of Indians prefer to buy homes priced between Rs 45 lakh and Rs 1.5 crore, despite a rise in residential prices, real estate consultancy Anarock said in a survey released on Sunday. The homes priced between Rs 45 lakh and Rs 90 lakh fall in the mid-range, while those priced in the range of Rs 90 lakh and Rs 1.5 crore are considered premium.

In its "Consumer Sentiment Survey" for the first six months of 2023, Anarock said that the number of people who want to buy mid and high-range homes this year is 10 per cent higher than in the first six months of 2020. This is despite high inflation impacting the disposable income of 66 per cent of respondents.

Among the two categories, mid-range homes are most favoured with 35 per cent of respondents out of a total of 5,218 preferring them. It was followed by 24 per cent preferring homes priced between Rs 90 lakh and Rs 1.5 crore.

According to Anuj Puri, chairman of Anarock Group, "Demand for bigger homes remains undeterred, with 3BHKs once again superseding 2BHKs in the current survey."

"Around 48 per cent property seekers prefer 3BHKs over other configurations, while 39 per cent still prefer 2BHK units. If we compare with the H1CY22 survey, demand for 3BHKs has been rising steadily – from 41 per cent in H1CY22 to 48 per cent in H1CY23. Bigger homes remain the top pick despite life returning to normal after the pandemic."

On the other side, the preference for affordable homes has gone down. From 40 per cent in H2CY20 to 28 per cent in H1CY22, and further down to 25 per cent in H1CY23. Affordable houses are priced below Rs 40 lakh.

Among the top cities, demand for 3BHKs is particularly high in Bangalore (51 per cent), Chennai (50 per cent) and Delhi-NCR (47 per cent). While demand for 2BHKs is high in Kolkata (52 per cent), Mumbai Metropolitan Region (41 per cent) and Hyderabad (47 per cent). Puri also said that a key reason for this shift towards costlier homes is the increased new supply by large and listed developers.

"These established players command much higher confidence among prospective homebuyers due to their reputation for timely project delivery."

The survey said that as of H1CY23, the demand ratio of ready homes to new launches stands at 28:27, denoting a significant gap reduction compared to H1CY20, when the ratio was 46:18. The survey added that home loan rates have remained largely stable in H1CY23 at an average of 9.15 per cent. 

This has kept the housing sentiment robust. However, 98 per cent of respondents feel that if they breach 9.5 per cent, it will impact their buying decisions "significantly". Moreover, 67 per cent of the respondents intend to buy the property for their own use and not for sub-letting.