The Indian residential real estate market is one of the most dynamic in the world. There is a constant flux in demand and supply,and developers are often challenged to keep up with the changing trends. Even with a firm finger on the pulse of the market,it is rarely possible to engage in a course correction to meet new demand trends when projects are already approved and under construction.However,one dynamic that is typical to the Indian market remains more or less as a constant — small is beautiful. In other words,developers can depend on smaller format homes to sell regardless of economic headwinds and other market factors. Nor are the lower price points attached to smaller homes the only reason for their enduring popularity. The fact is that many potential buyers either do not need vast floor spaces,cannot be bothered with the increased effort and expense in their maintenance and often have other reasons for being conservative.In such a scenario,the studio apartment — along with single bedroom configurations — has held its own ever since the concept was introduced in India.Studio apartments comprise of single large rooms that encompass the bedroom,living and dining areas,with compact kitchens and bathrooms attached. When they first made their appearance on the Indian residential landscape,it found favour largely with bachelors and small families who spend most of their time at work.Even today,the demand for studio apartments comes primarily from software professionals and executives from the manufacturing sector. Such professionals have generally spent over a year stationed in a metro and find that they prefer to pay EMIs on an affordable,maintenance-friendly living unit rather than pay high rents for flats and serviced apartments.There is a steady and inflexible demand for studio apartments,both in the metros and tier 2 cities. These apartments are usually the first to be sold out in a residential project that features them.Without doubt,they are the most cost-effective residential options for people who prefer to own rather than rent,especially in projects close to workplace hubs. Another factor that drives demand for such units is the ease with which they can be rented out or sold at a profit on the secondary market. This also makes studio apartments a prime target for investors. Moreover,studio apartments do not attract much maintenance costs and make for hassle-free purchases as well as resale.The typical Indian home buyer prefers larger homes,and will go in for more generous formats whenever possible. However,the rate of property price escalations in our primary cities has narrowed things down considerably. Simultaneously,proximity to the workplace remains a priority in an evolving economy,and the studio is the logical choice for those who cannot or do not choose to buy larger units.Studio apartments are also popular with mid-management level buyers who tend to reside in certain cities for extended periods. Rather than pay for a serviced apartment or a hotel room,they prefer to acquire studio apartments and sell them off when they no longer need them. There is also a lot of demand from single working individuals and newly-married couples who need to set up a home immediately and eventually upgrade to larger sized homes later on.When the downturn hit the Indian real estate market,practically the only residential configurations which continued to see demand were studio apartments and cost-effective 1 BHK flats. The demand for larger units has meanwhile revived considerably,but studio apartments are still the fastest-moving products on the market. The margins are low,but it is definitely a high volume vertical and many developers bank on such configurations as a sure-fire sales proposition,with almost instant absorption if the location is right. This provides them with instant working capital. The demand is even greater for furnished studio apartments,and many developers offer these as well.The current demand for studio apartments is percolating down from the equally high demand for serviced apartments,and is still picking up from there. Around 80 per cent of the overall demand for studio apartments in cities like Mumbai,Delhi NCR,Bangalore,Pune and Chennai is driven by software professionals and recently relocated manufacturing sector executives. Price points vary according to city,location and amenities offered,but generally range between Rs 12-35 lakh.— The author is CEO,Residential Services,Jones Lang LaSalle India