Mumbai flat sizes have shrunk 20% in past five years but other metros show improvement

• Mumbai Metropolitan Region (MMR) saw its average flat sizes reduce to 743 sq. ft. in Q1 2023, from 932 sq. ft. in 2018.
• Average flat sizes in the top seven cities have risen by 7% to about 1,225 sq. ft. in Q1 2023.
• On a yearly basis, the average flat sizes in the top seven cities in Q1 2023 rose 5%

New flat sizes in the financial capital of India, Mumbai, have shrunk by 20% in the last five years bucking the trend of consumers preferring larger homes in the rest of the top seven cities, as per real estate services provider Anarock.

Mumbai Metropolitan Region (MMR) saw average flat sizes reduce to 743 sq. ft. in the first quarter of 2023, from 932 sq. ft. in 2018. "In these five years, only 2020 saw average flat sizes in MMR see an annual rise of 21% against 2019. Since 2020, homes in the region are shrinking,” said Anuj Puri, chairman, Anarock Group.

However, this is an outlier. Despite rising property prices, average new flat sizes grew by 7% in the other top metros of India – to about 1,225 sq. ft. in Q1 2023 from about 1,150 sq. ft. in 2018.

Hyderabad, NCR: Size matters

Among the top seven cities, the national capital region (NCR) saw the highest growth in average flat size in the last five years – from about 1,250 sq. ft. in 2018 to about 1,700 sq. ft. in Q1 2023. When it comes to the highest average flat size, Hyderabad tops the list with about 2,200 sq. ft. in Q1 2023, followed by NCR.

“Before Covid-19, apartment sizes were shrinking annually to meet the demand for compact homes prevalent then," said Puri. "The central concerns were affordability and millennials’ preference for low-maintenance homes. 2020 saw an abrupt reversal of buyer preferences. With a sudden emphasis on the WFH and study-from-home culture, flat sizes began increasing for the first time in four years.”

On a yearly basis, the average flat sizes in the top seven cities in Q1 2023 rose 5% – to about 1,225 sq. ft. from about 1,170 sq. ft. in Q1 2022. MMR and Chennai were the exceptions as they saw a 6% and 5% decrease, respectively, in average flat sizes during the period.

“A perception among developers that there is currently sufficient existing supply of larger format homes may be a factor,” said Anarock, explaining the decrease in MMR as well as Chennai. “Also, while MMR is hyper-expensive, Chennai is a very cost-sensitive market. In both instances, increasing the supply of smaller, more affordable homes makes sense.

New construction, better space

On a yearly basis, NCR saw average flat size rise 50% in Q1 2023 while Kolkata saw flat sizes increase by 44% to 1,150 sq. ft. in Q1 2023.

While Hyderabad saw average flat size increase by 29% in the year, Pune saw a 16% yearly increase to 1,013 sq. ft. in Q1 2023, and Bengaluru saw a 8% yearly jump to about 1,300 sq. ft.