Hike service

Service class dominates, large houses still most in demand

ANAROCK sales data confirms that buyer preferences continue to rapidly evolve. Higher incomes and growing awareness of global lifestyle and living standards are pushing aspirations beyond mere need. As the COVID-19 pandemic has reignited the desire for “sustainable assets” like housing, some types of homes are selling better than others. The fact that buyers are spoiled for choice allows them to choose.

Certain trends become apparent when overlaying ANAROCK’s most recent sales figures over broader market transaction data. Buyers’ attention has clearly shifted from affordable housing (homes priced below Rs40 Lakh) to mid-range (Rs40 – 80 Lakh) and high-end (Rs 80 Lakh to Rs1.5 crore) homes. . This is very clear from the analysis of buyer behavior in the seven major cities in the last fiscal year 21-22: nearly 80% of demand is for mid-range and high-end homes, the housing segment affordable representing only 10% of demand.

Rahul Phondge, Commercial Director of ANAROCK Group, says: Chennai and Pune had the highest demand in the midscale segment and accounted for almost 60% and 59% of the total demand in these cities. Bangalore recorded almost 56% of the demand oriented towards the high-end segment. Among the city’s overall home sales, Hyderabad showed the highest demand for luxury (17%) and ultra-luxury (8%) homes priced above Rs2.5 crore. While the average prices in Hyderabad are much lower than those in the Mumbai Metropolitan Area (MMR), the size of properties in these segments is significantly larger than in the MMR.

In major cities, typologies 2 and 3 BHK generated the maximum demand, accounting for 64% of overall demand. 2 BHK units are most popular in Chennai, where nearly 67% of sales in the year were in this configuration. Bengaluru sold the most 3 BHK units, which accounted for 49% of overall sales during the year, closely followed by Hyderabad with 44%.

National Capital Region (NCR)

At Delhi-NCR, 4BHK+ and conspiracies stole the show. The preference for independent, low-density living meant that 4BHK accounted for 17% of sales and plots for 16% in the financial year. The region also saw 16% of the overall demand for Category 1RK/Studio homes at the other end of the spectrum. End users accounted for 93% of transactions, with two-thirds coming from the class of service.

Mumbai Metropolitan Region (MMR)

Due to MMR’s urban sprawl and hectic market activities in outlying areas, the demand for mid-range and high-end homes dominates. Mid-range housing accounted for 46% of overall demand in FY21-22, while high-end housing accounted for 39%. Preference for 2BHK units is increasing, accounting for 50% of demand. The prospect of future price appreciation is also attracting investors, with approx. 13% of buyers clearly state that they are investing for the long term.

A study of buyer profiles shows that 64% come from the service class, and 23% come from business circles. This diversity indicates a healthy mix that will help the market weather economic disruptions.


The Tech Halli has also seen growing investor interest over the past fiscal year. Nearly 16% of home purchases were made by people focused on long-term investing. A significant portion of this demand appears to be fueled by an appetite for second homes in outlying areas of the city. While the final verdict on the future of workplaces has yet to be made, a hybrid model is expected to be more popular, especially among employees in the IT-ITeS sector.

Socially distanced living in outlying regions to ensure better pandemic safety protocols has also increased the demand for land and villas. These assets represented approx. 12% of trades. This group of shoppers has experienced little to no professional impact from the pandemic and has realized significant savings due to the limited scope of general consumption.

Despite the recent marginal rise, interest rates are still attractive, while ongoing government incentives are still working well for first-time end-buyers and second home investors. As prices begin to rise and the mortgage rate tightens, current market dynamics may change.

The author of this article is Mr. Rahul Phondge, Commercial Manager, ANAROCK Group

The views and opinions expressed are not those of IIFL Securities, indiainfoline.com