Studio Apartments hardest hit in scramble for bigger homes – Supply share down to 9% in H1 2022
The studio apartments trend is historically the strongest in West India, with MMR and Pune predominantly driving the trend.
The overall supply share of studio apartments, among the hottest-selling configurations before the Covid-19 pandemic, has been dipping across the top 7 cities since 2020.
Latest ANAROCK research shows that out of 1,063 projects launched in H1 2022 across these cities, only 91 projects offered studio apartments – a 9% share. In contrast, of the 1,921 projects launched in 2019, around 368 (19%) had studio apartments.
In 2020, the share was 15% – of 884 projects launched in the year, approx. 130 projects offered studio apartments, while in 2021, 145 out of 1,207 launched projects had them as options.
This y-o-y decline is a significant trend reversal – between 2013 and 2019, the share of new projects offering studio apartments showed a y-o-y increase – from 4% in 2013 to 19% in 2019.
“The studio apartment configuration – single rooms serving as bedroom-cum-living room with kitchenette and an attached bathroom – was among the most popular configurations before Covid-19,” says Anuj Puri, Chairman – ANAROCK Group. “Once seen as ideal starter homes, they drew considerable demand from bachelors, business travellers visiting the city frequently for work, and young couples. What they lack in size, they often make up on location – studio apartments are most evident in pricey locations around key employment hubs.”
“The rapid reversal of this trend after Covid-19 is indicative of the major socio-economic changes that have occurred due to the pandemic,” says Puri. “Of 2,102 projects launched in the top 7 cities in 2013, just 75 projects had this option. After that, their availability in projects grew consistently, peaking at 19% in 2019.”
2020, the first and most devastating pandemic year, kickstarted the work-from-home culture – and the ensuing demand for bigger homes. Simultaneously, CBDs and SBDs lost their appeal to the cheaper suburbs and peripheries. In a single year, studio apartments’ presence in new supply sank to 15%, to 12% in 2021, and to 9% in H1 2022.
The studio apartments trend is historically the strongest in West India, with MMR and Pune predominantly driving the trend. Of the total projects with studio apartments launched in the top 7 cities between 2013-2020, MMR and Pune together accounted for a massive 96% share.
In contrast, the southern cities of Bengaluru, Chennai, and Hyderabad never really caught the studio apartment wave – just 34 projects in these three cities had this compact configuration in the same period.
In H1 2022, of 91 projects offering studio apartments across the top 7 cities, MMR is at the top with 71 projects, followed by Pune with 18 projects. In Bengaluru, just 2 projects offer this configuration while the other cities do not offer it at all.
The pre-pandemic years saw studio apartments being offered not just in MMR and Pune but in other cities as well. As such, their supply share decline after the pandemic is remarkable.