Rising prices for shrinking houses: How lavish lifestyle comes at the cost of higher loading factor; check this before you buy

Time of India

23-06-2025

Imagine an Olympic-size swimming pool, a swanky multistorey clubhouse, badminton and tennis courts, and landscaped gardens. A few years ago, you would have been picturing a luxury retreat nestled somewhere in the hills. But what was once a dreamy escape is now part of everyday life for many. An oasis of calm, comfort and luxury awaits Indian homeowners within plush housing complexes mushrooming amid the hustle-bustle of its big cities. However, this elevated living comes with a sharp trade-off: homebuyers are paying through the nose for open spaces, while making do with less living space.
Lavish living, cramped spaces
When you buy an apartment, you do not just pay for the liveable area within its four walls. A portion of the cost also goes toward shared spaces in the housing society—this is known as the '
loading factor
'. It refers to the proportionate share of ancillary common areas and amenities added to the carpet area (usable inner home area) and included in the price charged to the buyer. It essentially refers to the difference between the super built-up and the carpet area of an apartment. To put it simply, the carpet area refers to the floor space where you can actually lay a carpet. The built-up area includes the carpet area plus the space taken up by the walls and ducts. The super built-up area includes the built-up area along with a proportionate share of common spaces such as the staircases, lift shafts, entrance lobbies, corridors, parking areas, and amenities. 'In India, property prices are usually calculated based on the super built-up area. While developers market homes based on this figure, the real value lies in the carpet area,' points out Akhil Rathi, Head– Financial Advisory at 1 Finance.
A recent report by ANAROCK throws light on the steep premium homebuyers are paying for their lap of luxury. According to the
real estate
consultancy, the average loading factor in apartments across India's top seven markets has climbed sharply from 31% in 2019 to 40% in January-March 2025. This means that of the total space you are paying for, only 60% is the home interior, while 40% of the cost is for the common areas and amenities. In the past, a loading of 25-30% was the norm.
Loading factor has surged
MMR faces highest loading; Bengaluru sees steepest rise
Homebuyers' preferences for a certain lifestyle is contributing to this trend. Nowadays, homebuyers covet expansive lounge areas with cafes, state-of-the-art gymnasiums, rooftop decks and multi-purpose utility areas. Experts point out that the loading factor is directly proportional to the amenities in a project. The cost of additional amenities provided by the developer is usually passed on to customers in the form of loading charges. Invariably, loading will be higher for larger projects, where more space is allotted to amenities and common areas.
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Prashant Thakur, Regional Director & Head–Research & Advisory, ANAROCK Group, observes, 'Today, higher amenity loading has become the norm across most projects partly because homebuyers are no longer satisfied with basic lifestyle amenities— they expect fitness centres, clubhouses, park-like gardens, and grand lobbies.' Additionally, regulatory and safety requirements, such as fire escapes, utility zones, and larger elevators, further increase the common areas, thereby adding to the loading, points out Rahul Purohit, Cofounder & Chief Business Officer, Square Yards.
But the flip side is that homebuyers end up giving up on actual living spaces. Buyers often end up paying a premium for homes with less actual living area because the pricing is based on the super built-up area, not the space the residents actively use, Rathi explains. 'While such facilities may enhance the community living experience, they also reduce the size of individual units, resulting in tighter bedrooms or smaller living spaces,' he says. Jayesh Rathod, Co-Founder and Director of The Guardian Real Estate Advisory, asserts, 'Homebuyers are increasingly paying a significant portion of their total home cost for shared spaces rather than actual liveable space.'
'While high loading doesn't automatically lower resale prices, it may narrow the pool of interested buyers due to perceived space inefficiency", says Akhil Rathi, Head – Financial Advisory, 1 Finance.
According to the ANAROCK report, Mumbai Metropolitan Region continues to see the highest loading among the top seven cities, with 43% in January-March 2025. Bengaluru has seen the highest percentile jump in average loading over the last seven years–from 30% in 2019 to 41% in January-March 2025. The ANAROCK report suggests this dovetails with the increasingly higher saturation of modern amenities that developers now include to cater to the higher lifestyle ask in the IT hub. Chennai, on the other hand, has the least average loading rise in January-March 2025 with 36%, aligning with a city-specific demand profile where homebuyers prefer to pay more for usable space within their homes rather than for common areas. In 2019, Chennai's average loading percentage was 30%.
Same budget, different loading factors
Knowing the loading factor helps assess value.
Balancing act
For homebuyers, the loading factor of an apartment is critical when evaluating projects with extensive amenities and open spaces. It is indicative of the functionality of the house. It also reveals the real value behind the price tag. Loading ratio tells you how much space you get for the money you spend. If the ratio is higher, it implies that you are paying a higher price per square foot than the advertised cost. Homebuyers can effectively compare relative value proposition of different projects. For example, if two apartments—Unit A and Unit B—each have a super built-up area of 1,000 sq ft and are priced atRs.75 lakh, but their loading factors are 25% and 33% respectively, it means Unit A offers more liveable space at 800 sq ft compared to Unit B's 750 sq ft. This trade-off between amenities and functional space begs careful consideration.
'This trade-off, paying more for less private space, has become a growing concern among urban homebuyers, especially in cities where affordability is already a challenge,' says Rathi. Individual preferences may differ, so buyers should evaluate offers accordingly.
'Higher amenity loading has become the norm across most projects partly because homebuyers are no longer satisfied with basic lifestyle amenities," says Prashant Thakur, Regional Director & Head -Research & Advisory, Anarock.
'For buyers who value access to curated amenities and community experiences, the premium associated with such projects can be well worth it, even if it means a slightly smaller functional space,' avers Purohit. Conversely, for those who prioritise maximum carpet area and functional layouts over lifestyle features, choosing a project with minimal loading and fewer amenities might be more suitable, he adds.
Loading may also impact the resale value of your house. It can bolster or dilute the appeal of the tenement, depending on buyer preferences in the secondary market, experts say.
Housing prices have shot up sharply
Bengaluru has seen highest jump; Mumbai commands biggest premium.
'On one hand, projects with premium amenities and lifestyle-driven features often appeal to a certain segment of buyers looking for comfort, convenience, and community living. However, if the functional space feels significantly compromised, it could limit the resale pool or affect price appreciation over time,' contends Purohit.
'Higher loading may affect the resale value in some cases, particularly when similar properties in the vicinity or even nearby locations offer more usable space at the same price,' Thakur remarks.
How to calculate loading factor
Buyers must verify charges to avoid overpaying for less space.
If super built-up area is 1,000 sq ft and carpet area is 750 sq ft:
Older or more thoughtfully designed homes with minimal loading and better space distribution often attract greater interest during resale, Rathi points out.
However, if a new project is developed by a well-known builder and offers premium amenities, some buyers may still find value in the overall lifestyle offering. 'So, while high loading doesn't automatically lower resale prices, it may narrow the pool of interested buyers due to perceived space inefficiency,' Rathi adds.
Get clarity on the loading factor
For homebuyers, clarity on the loading factor and actual living area is essential. Unfortunately, the practise of 'loading' in real estate is shrouded in a web of secrecy. Developers conveniently do not mention the loading factor in their glossy sales brochures. Regulations do not mandate developers to disclose this figure either. This leaves homebuyers in the dark about the value they are getting. To be sure, the Real Estate (Regulation and Development) Act, 2016, requires developers to mention the total carpet area provided to homebuyers. But not all states enforce the law. 'In most cases, buyers across cities, except in Maharashtra, are unaware of how much they pay towards the overall usable space within their apartment,' avers Thakur.
Besides, there is no law that currently limits the loading factor in residential housing. It is left to the discretion of the developers, who justify higher loading for the amenities provided. In the absence of any regulation, some developers charge loading as high as 50% or more for their projects, experts point out.
The onus is on buyers to remain vigilant. Here's what you can do:
Ask your builder, the exact carpet area you are paying for and compare it with the super built-up area. 'Request a clear breakdown of costs, what portion goes to actual usable space and what is for common amenities,' says Rathod.
Compare carpet-to-super built-up ratios across similar projects, thoroughly study floor plans, and, if needed, consult an architect or a real estate adviser. 'Comparing loading percentages across projects can highlight anomalies and offer a strong basis for negotiation, especially if the loading appears excessive,' Purohit comments.