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Bigger is better for Indian homebuyers, according to the latest FICCI-ANAROCK Consumer Sentiment Survey (H2 2023). The survey reveals a significant shift in preferences, with a growing demand for larger apartments and a move towards suburban living.
The survey found that 50% of respondents favour 3 BHK apartments, a significant jump from 42% in the previous year. This trend is particularly strong in major cities like Bengaluru, Chennai, Hyderabad, and Delhi-NCR. Mumbai remains an exception, with 44% of respondents still preferring 2 BHKs, likely due to higher property prices.
Despite rising costs, the survey indicates a growing interest in luxury homes. The number of respondents looking to buy properties priced above INR 1.5 crore has doubled since 2021, reaching 20% in H2 2023. However, the INR 45-90 lakh budget range continues to be the most popular, preferred by over 33% of potential buyers.
The survey highlights a clear shift in priorities for homebuyers. Affordability has dipped to 21%, compared to 25% in the previous year and 40% in 2020. This suggests that buyers are willing to spend more for larger homes and better amenities.
The return to office trend seems to be influencing residential choices. With 30% of respondents favouring suburban areas for buying a home, compared to 25% last year, there is a clear preference for more spacious living outside the city centre.
Open spaces are now a major priority, with 75% of respondents seeking homes with balconies. Additionally, 74% emphasize improved construction quality, indicating a growing awareness of long-term value and safety.
While real estate remains the preferred investment option for over 57% of respondents, rising interest rates make fixed deposits (FDs) more attractive. Interestingly, the survey also points out that investors are increasingly looking at residential properties, with 36% planning to buy for investment purposes.
Over 73% of respondents stated that their home buying decision wouldn't be significantly affected if home loan rates stay below 8.5%. This suggests that although inflation has an impact, it doesn't seem to be a major deterrent compared to the previous year, with only 55% reporting a noticeable impact in 2023, compared to 61% in 2022.
The Indian housing market is witnessing a clear shift in buyer preferences. Bigger spaces, suburban living, improved quality, and open spaces are now top priorities. With rising interest in luxury homes and investor activity, the market is expected to remain dynamic in the coming months.
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