Eyeing demand,developers shift focus to small houses

National developers,who launched projects in the tricity banking on luxury apartments,are now restructuring these units into smaller and affordable houses.

“Affordability factor translates into demand for small-sized property in the residential sector. The supply,especially from private colonisers and builders,till recently was primarily of bigger,luxurious apartments,” Manoj Kashyap,regional director,Jones Lang LaSalle Meghraj,a global real estate services firm,says. “The demand in the small budget segment also translates into better returns for the investor.”

Since the budget of majority of buyers is of one-bedroom and two-bedroom apartments,the demand is high. “Considering my budget,I booked a two-bedroom apartment in Gulmohar City,a project by Raglan Infrastructures Limited,at Dera Bassi for Rs 13.31 lakh in May this year,” Rajesh Arora,who lives with his family in Jammu,says. “Since I belong to Jalandhar,I wanted to settle near the area,and Chandigarh was a good option.”

Another advantage in case of smaller units is the comparatively cheaper home loan rates,recently reduced by banks. For example,the interest rate on home loan up to Rs 5 lakh,for a maximum period of 20 years,will not go beyond 8.5 per cent in the first five years.

In this category,even the loan value has been increased. Now,a borrower can get a loan up to 90 per cent of the value of the house. The interest rate on loan up to Rs 20 lakh,for a maximum period of 20 years,has been fixed at 9.25 per cent and the margin has been reduced to 15 per cent.

“The middle class might aspire for luxury houses,but exorbitant real estate prices make them go for smaller houses. Developers are also offering discounts to sell these units,” Ashok Pradhan,an army officer posted in Punjab,says. “I recently invested in a one-bedroom studio apartment in Shakun Suncity,Baddi,through a bank loan.”

Besides the tricity,such units are coming up in adjoining areas like Baddi and Kharar.