MC Exclusive: Pune techies prefer 1 BHK apartments as affordability hit, shows data

According to industry experts, as the work-from-office culture started and affordability started getting hit, techies returning to Pune prefer purchasing a 1 BHK apartment, compared to larger ones.

With home loan rates increasing in the last two years and the purchasing power of homebuyers getting impacted on account of the global slowdown in the IT sector, Pune is witnessing an increase in launches in the 1 BHK category, according to Maharashtra Real Estate Regulatory Authority (MahaRERA) data.

According to the data, in the first half of 2023, around 11,000 1 BHK apartments were launched in Pune district (the IT capital of Maharashtra), compared to 6,365 in the second half of 2022. In 2022, around 18,000 1 BHK apartments were launched in Pune district.

Overall, apartment launches in Pune district went down to 60,000 in the first half of 2023, compared to 70,000 a year ago in the same period.

According to industry experts, as the work-from-office culture started and affordability started getting hit, techies returning to Pune prefer purchasing a 1 BHK apartment, compared to larger ones. In Pune, more than 70 percent homebuyers are techies working in the IT sector.

What does data say?

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Mehul R Thakkar

Special Correspondent|Moneycontrol

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According to the data, in Pune, 11,648 1 BHK apartments were launched in the first half of 2023, followed by 25,479 units of 1.5 and 2 BHK apartments, and 11,529 units of 2.5 and 3 BHK units, respectively.

In terms of ratio, out of the total launches in the first half of 2023, 19 percent were 1 BHK apartments, 42 percent were 1.5 and 2 BHK apartments and 19 percent were 2.5 and 3 BHK apartments.

In the whole of 2022, this ratio was 16 percent for 1 BHK apartments, and 45 percent for 1.5 and 2 BHK apartments, and 23 percent for 2.5 and 3 BHK apartments, respectively. (Hope this is what you mean)

Apartments smaller than 322 sq ft on the rise

In Pune, 8,951 units up to 322 sq ft were launched in the first half of 2023, compared to 7,930 in the entire calendar year of 2022. Further, units in the range of 322 sq ft to 484 sq ft in the first half of 2023 stood at 8,349, compared to 17,406 in the entire calendar year of 2022.

Also read: Is the Pune real estate market going the Mumbai way?

Where are the highest launches?

According to Rahul Ajmera, Developer of Vasupujya Corporation, who is associated with the data analysis wing of real estate developers’ apex body, the Confederation of Real Estate Developers' Associations of India (CREDAI), Pune, micro-markets, like Punawale-Tathawade and Wakad-Hinjawadi, were the locations where maximum units have been launched (6,600 each).

Conversely, areas like Hadapsar-Handewadi, Keshavnagar-Mundhwa, and Dhayari have witnessed a sustained decrease in supply, which could potentially lead to a rise in prices in these areas, Ajmera added.

Ajmera, who collated the MahaRERA data for the Pune real estate market, further said: "The number of launches in Pune's real estate market in the first half of 2023 (around 60,000 units) decreased, compared to the same period in 2022 (around 70,000 units). This indicates a probable consolidation in response to global market uncertainties and rising prices."

"After seeing a decline in previous years, the supply of 1BHK units and smaller ones, like 1 RK and studio apartments, have increased in the first half of 2023, suggesting a rise in demand due to higher prices and reduced affordability," he added.

Affordability issue leads to rise in 1 BHK apartments

According to experts, the rise in 1 BHK apartments can be attributed to affordability getting hit, along with the resumption of work from offices and the hybrid work culture.

Also read: Real estate project registrations have gone down in Maharashtra in H2CY22: MahaRERA data

"There is no doubt that affordability has been hit in the last two years, so techies in Pune, the IT capital of Maharashtra, have shown more interest in purchasing 1 BHKs when compared to the past few years. Work from office or the hybrid work mode have resumed in many of the city's IT companies, bringing IT/ITeS employees back to Pune," said Aditi Watve, President - Residential Sales & Capital Markets (Pune), ANAROCK Group, a real-estate consultancy firm.

Also read: Pune apartment prices rise 11% but sales down 8%, says GERA report

"They (IT employees) are preferring 1 BHKs, and in the Pune Metropolitan Region, the sweet spot for purchasing a 1 BHK apartment is between Rs 30 lakh and Rs 50 lakh. This is one reason why we must be witnessing more 1 BHK launches in the first half of 2023, considering that about 85 percent of the city's homebuyers work in the IT space," she added.