BHUBANESWAR: How often do we come across a situation wherein supply in the real estate market is not aligned with market demands? The probable answer may be – several times. A similar situation looms large on the Noida realty market. There is a significant mismatch between demand and supply of different configurations. While 2BHK seems to be the preferred size for buyers, developers are largely building 3BHK units.
The data also shows that supply for 2BHK units has remained just above 30 per cent in the last two quarters (Oct-Dec 2012 and Jan-Mar 2013) while that of 3BHK has inched up slightly and settled at 45 per cent of the total supply in the market during the same period. 2BHK units have remained the preferred category with nearly 45 per cent share of the market demand in the last two quarters (Oct-Dec 2012 and Jan-Mar 2013). This indicates a considerable difference of nearly 15 per cent between demand and supply of 2BHK apartments in Noida.
Vikas Sahani, Chairman and Managing Director, Property Guru Pvt Ltd, explains. “Buyers in Noida are price sensitive. Most of the demand in the sub-city today exists for properties in the budget range of Rs 50-55 lakh. Projects that nearing possession was launched at much lower rates as compared to what the market values are today. For instance, way back in 2010-11 per sq ft value was approximately Rs 3000 per sq ft. Thus it was possible to construct a 3BHK unit within a budget of Rs 50-55 lakh. However, today the rates are around Rs 4500-5000 per sq ft. At this rate one can only get a 2BHK apartment within the preferred budget range.”
He continues, “Thus the demand existed for the particular budget of Rs 50-55 lakh and not for 3BHK units. However, the developers have not realized this.”
Density norms also compel the builders to construct larger homes. “At present the density norm in Noida is 1650 per hectare. Thus if we build smaller units, the projects would become too crowded. This in turn puts strain on the resources in the society. For instance, we would have to give more parking space, larger club houses, etc. to accommodate the larger population. Thus we prefer to have a particular number of larger units to maintain the balance in the project,” explains Anubhav Jain, Director Silverglades Pvt Ltd.