Throwing some light on the demand and supply scenario, global property consultant, Knight Frank pegs the segment’s market size at Rs 3,00,000 crore by the year 2011, considering the average price of Rs 2,000 per square feet.
In its recent report on affordable housing, the consultant said the “mammoth scope of this sector is expected to arise from housing requirement of over 2 million units by 2011.”
The research was conducted across 1,400 households, and seven cities comprising NCR, Mumbai, Pune, Bangalore, Chennai, Hyderabad and Kolkata, covering people between Rs 3-10 lakh annual income group. It said “the housing requirement for the Rs 3 lakh-10 lakh income group across the seven cities is approximately 2.06 million units, which assuming an average household size of 800 sq ft, translates to a requirement of 1,650 million sq ft of space.”
Unfavourable city
However, it has placed Bangalore as one of the most unfavourable cities along with Mumbai and National Capital Region (NCR) for affordable housing, mainly due to high cost of construction, which makes it difficult for the builders to provide affordable housing in key areas. Still, Bangalore is expected to pitch-in with 3,27,694 units on the demand front to the overall projection of 2 million units, and is pegged to have a market size of Rs 524 billion.
The report reveals that 88 per cent of the potential house buyers belonged to the salaried class (private), mostly from the IT and ITeS sectors.
The survey, found that in Bangalore, people from the Rs 5-6 lakh income group will contribute to about 33 per cent of the demand, while Rs 3-5 lakh, Rs 6-8 lakh and Rs 8-10 will contribute 25 per cent, 18 per cent and 24 per cent respectively.