Apartments priced under Rs 5000 per sq ft are in great demand

Sale of apartments across the nation gets a significant boost, as demand for apartments priced under Rs 5000 per sqft creates a niche for itself in the market. According to key property consultants, in the last one year, 3 out 4 homes sold in major cities like National Capital Region, Mumbai, Chennai,Bangalore and Pune belong to this category.

In the last one year, 73% of the total sales in the major cities of India belonged to this category. More than 80% of the sales in NCR, 78% in Chennai and 84% in Bangalore were in this segment. Mumbai Metropolitan Region, however, witnessed the lowest number of apartments sold in this category at 42%.

Price stability is an issue

Buyers of this segment are of the notion that prices are likely to shoot up and such a level of affordability may be not be available in the future. Between 2010-12, property prices witnessed a sudden surge, however, in the last one year prices have stabilized and even hit the dirt in few areas.

As per the National Housing Bank, the quarter to September witnessed a marginal rise in price in 12 cities, while 10 cities suffered from a drop in rates. The National Capital Region witnessed a drop of 4.5% while Bangalore encountered a drop of 1%.

Why people are buying in this segment

With developers offering attractive schemes and discount, buyers feel motivated to purchase in this category. In addition to it, drop in prices in the last few quarters has further boosted the buyer’s sentiments. Experts anticipate that prices will again jack up once the elections are over.

Furthermore, the loan required in this category is comparatively lower, hence servicing becomes relatively affordable. A majority of buyers in this segment belongs to the working class category. From the viewpoint of job continuity, the buying behavior of the investors is deeply encouraged since unemployment/job loss is hardly a possibility in the present economy.