It used to be a developer’s easiest-to-move inventory, thanks in no small part due to cheaper price tags and popular rental demand from business travellers and young professionals at the start of their careers. However, since the COVID-19 outbreak in 2020, the humble studio apartment has all but vanished. At least that’s what data from property consultant Anarock seems to indicate.
According to Anarock’s research, only 91 of 1,063 projects launched in NCR, MMR, Chennai, Bengaluru, Pune and Hyderabad in the first six months of 2022, had studio apartments — a share of just 9 percent. The year before COVID, 368 of the 1,921 projects (19 percent) launched in these markets offered studio apartments.
The year-on-year decline in the share of studio apartments in real estate projects since the pandemic has been rather noticeable, more so because of the increasing share this product portfolio boasted of till 2020. In fact, the seven years before 2020 saw the share of studio apartments in real estate projects increase from a mere 4 percent in 2013 to 19 percent in 2019.
The decline today is widely considered to be a result of what some experts are calling the “socio-economic changes” that began post-pandemic. “In 2020, work-from-home culture began and it brought with it demand for bigger homes,” says Anuj Puri, Chairman, Anarock. “Simultaneously, CBDs and SBDs lost their appeal to the cheaper suburbs and peripheries. So, in a single year, new studio apartment supply sank to 15 percent in 2020, 12 percent in 2021 and 9 percent in the first half of 2022.”
Historically, the western property markets have held pole position as far as studio apartments are concerned, with MMR and Pune driving the trend. In fact, both markets accounted for a whopping 96 percent of all studio apartments launched between 2013 and 2020. This is understandably owing to higher property prices in Mumbai and parts of MMR.
The South, on the other hand, never really caught on the studio apartment wave despite cities like Chennai having a mandatory 10 percent reservation for one-bedroom apartments in real estate projects beyond a certain size. Chennai, Bengaluru and Hyderabad accounted for just 34 projects with studio apartments in the seven years before COVID.
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Today, out of the mere 91 projects with studio apartments launched across seven property markets between January and June this year, MMR continues to lead the way with 71 of its projects offering studio apartments. Bengaluru saw just about two of its projects with the product offering, while the other cities do not even feature on the list.
“The studio apartment configuration — single rooms serving as a bedroom and a living room with a kitchenette and an attached bathroom — was among the most popular configurations before COVID-19,” said Puri, “What studio apartments lack in size they often make up for in terms of location, especially given the number of studio apartments in pricey locations around key employment hubs.”
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Studio apartments: Rise & fall
The decline in supply share of studio apartments post-pandemic is remarkable.
