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The share of mid-market houses costing Rs 20 to 50 lakh has touched an all-time high of 42 per cent of total residential transactions in the second half of the current fiscal, according to data released by real estate consultant Square Yards.
The share of mid-market houses has been going up every six months in the last few years. It accounted for 29 per cent of overall residential sales in the first half of FY 17, going up to 32 per cent in the second half of the same financial year. The category touched 42.7 per cent mark of the overall residential sales in the first half of the current fiscal, growing at 21 per cent CAGR.
Latent demand
“There has been huge latent housing demand at the middle stratum of the society that is now being taken care of. The requirement is now being matched by supply. This segment is increasingly becoming important constituent in the portfolio of most developers across the country and will drive the real estate sales in future too,” said Mr Tanuj Shori, Co-Founder and CEO, Square Yards.
Consequently, there have been a flurry of launches of mid-market housing projects. Developers are now so focused that they have launched dedicated brands only for mid-market segment. These include ‘Joyville’ brand by Shapoorji Pallonji Group, ‘HomeKraft’ by ATS and ‘Provident’ by Puravankara.
While the parent companies will continue to build houses in other categories, the new brands created by them will help position them in mid-market houses category differently and help them leverage government benefits, he added.
Incentives
Buyers have also been incentivized through PMAY scheme in which subsidy between 2.30 lakh to 2.67 lakh has been provided to wider population with family income ranging till 18 lakh per annum. PMAY scheme has been designed in such a way that benefit can be extended to wider range of apartment size based on annual family income.
The segment got a shot in the arm in January this year when the Goods and Services Tax rate on mid-market houses was lowered from 12 per cent to 8 per cent. Developers have been able to pass on the benefit of lower taxes in the form of lower prices of the apartments which is making the deal sweeter for the end consumers, said Shori.
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