Why are developers downsizing projects

To make houses more affordable, developers have reduced unit configurations by as much as 19 per cent in some markets, says a recent Knight Frank report. Seeking to tap relatively stronger demand in the mid-size and budget segments, developers have redesigned their projects to include smaller units. The budget segment has accounted for 53 per cent of launches in the top nine cities in the first half of 2016, and barring Gurgaon and Bengaluru, around 50 per cent of the demand has been for properties in the affordable segment. The average delivery of projects as a percentage of under-construction stock rose six-fold in Q1 2016, compared to Q1 2014, as per a Proptiger report. With this trend, some companies have redesigned houses in the range of Rs 50-60 lakh and Rs 25-30 lakh from the earlier Rs 60-90 lakh. Other redesigned projects include Supertech Aadri in Gurgaon and Golf Country on Yamuna Expressway in Noida; Mumbai-based Mathan Group’s Manthan Embassy in Bandra; SARE Group’s project in Gurgaon; and Purvanakara Group’s project in JP Nagar, Bengaluru.