Studio Apartment Supply Declines As Mumbai Housing Preferences Shift

Mumbai’s residential property market saw a notable shift in 2025, with new studio apartment launches falling to their lowest level in at least half a decade, signalling changing developer priorities and evolving urban housing demand. Regulatory filings indicate that fewer than 800 studio units entered the market during the year, underscoring how compact homes are steadily losing ground within the city’s increasingly constrained real estate landscape.

Studio apartments accounted for only a small fraction of total residential supply added in 2025, as overall housing launches themselves moderated compared to previous years. The decline reflects a broader recalibration underway among developers, who appear to be concentrating on home sizes that offer greater pricing resilience and steadier buyer absorption in a high-cost, land-scarce city. Market data show that the bulk of new residential supply last year comprised one-bedroom and two-bedroom configurations, together forming the majority of units launched across Mumbai. These formats continue to attract both end-users and investors due to their relative affordability, functional layouts and flexibility for multi-purpose living, including work-from-home needs. Larger homes, including premium mid-size and high-end apartments, also retained a consistent share of launches, reinforcing a barbell pattern in supply that leaves little room for ultra-compact units.

Urban planners and industry observers suggest multiple structural reasons behind the retreat of studio apartments. Escalating construction costs, stricter development norms and limited availability of redevelopment-ready land have pushed developers to maximise revenue per square foot. In such conditions, micro-units often struggle to justify their place within new projects, especially when demand visibility remains uncertain. Buyer preferences have also evolved in the post-pandemic period. Households increasingly seek homes that can accommodate flexible lifestyles, including separate zones for living, working and rest. Studio apartments, once positioned as efficient entry-level options for young professionals or single occupants, are now perceived as restrictive by a wider section of buyers navigating longer stays at home and hybrid work routines.

The slowdown in studio launches also highlights a deeper affordability challenge. While smaller homes are often seen as tools to widen housing access, their declining presence suggests that market-led solutions alone may not adequately address the needs of first-time buyers, migrants and single-person households in India’s most expensive property market. Without supportive planning frameworks, rental housing policies or innovative financing models, compact housing risks being crowded out by market economics. Looking ahead, the reduced pipeline of studio apartments raises important questions for Mumbai’s long-term housing diversity. As the city pushes towards sustainable, inclusive urban growth, balancing density, liveability and affordability will remain critical. Whether compact homes can re-emerge in new forms—through co-living, rental housing or transit-oriented development—will depend on how policy, planning and market forces align in the coming years.

Studio Apartment Supply Declines As Mumbai Housing Preferences Shift