Shrinking! Often felt your flat is smaller in size? Yes, it's true - Here is why
NCR flat developers have started to launch flats with smaller sizes in last five years.
On account of providing the affordable housing benefits to the home buyers and avail 100 per cent income tax exemption in the real estate project, NCR developers have started to launch flats with smaller sizes in last five years. According to the real estate consulting firm ANAROCK, NCR flat sizes have shrunk by 16 per cent in the last five years. The industry insiders say, flat-sized have shrunk because of the carpet area of the flat is 60 sq mtrs or below, the home buyers would be eligible for availing the CLSS (Credit Linked Subsidy Scheme) benefits under the Pradhan Mantri Aawas Yojna (PMAY) and the GST levied on their purchase would be only 1 per cent now. Additionally, the developers would be eligible for 100 per cent tax exemption in the income of that project.
Speaking on the findings Anuj Puri, Chairman – ANAROCK Property Consultants told Zee Business online in a written statement, "The NCR flat sizes shrink by 16 per cent in last five years — one per cent lesser than average property sizes in top 7 cities that witnessed decline by 17 per cent in the same in five years." He said that major factor contributing to the shrinking apartment sizes across most metros is the rising demand for budget-friendly housing. With property prices going overboard in most metros, developers have been reducing sizes to align their offerings more with the actual homebuyer demand.
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Elaborating on the reason for shrink in size of flats Ankur Dhawan, Chief Investment Officer at PropTiger said, "Developers are coming with flats that have size of 60 sq mtrs or below as it would enable home buyers to avail the CLSS benefit falling under the Pradhan Mantri Aawas Yojna that has fuelled the affordable housing in India." Dhawan said that due to the affordable housing developers to have the benefit of 100 per cent tax exemption on their income in the projects that have flats with sizes of 60 sq meters or below. He went on to add that another reason for shrinking apartment sizes is that most millennial homebuyers are averse to investing in both the higher maintenance costs and extra efforts that larger properties entail. However, this is not their only reason - Millennials actually prefer to own smaller homes.
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