Bangalore’s Booming Real Estate: Trends and Prospects
In India’s journey to becoming one of the most powerful economies in the world, we cannot deny the critical role the IT industry has played. In fact, the sector, which currently contributes 8 percent to the country’s GDP, is projected to increase to 10 percent by 2025. Around 30 percent of the IT industry’s revenue comes from the city of Bangalore. Indeed, in less than two decades, the city has become synonymous with the IT industry, home to tech giants such as Google, IBM, and Microsoft.
Popularly known as the Silicon City of India, the city today is one of the fastest-growing cities in India and acts as a major hub for biotechnology and aerospace, in addition to IT. Furthermore, the Karnataka government has made proactive efforts to transform the city into an impressive investment hub, with the city’s infrastructure and liberal investment ecosystem unrivalled in India.
This has not only led the city to become a magnet for Fortune 500 companies and startups, but has also led to the migration of working professionals from all over the country. This has undoubtedly precipitated high demand for residential spaces, with Knight Frank’s recent study ‘Asia Pacific Outlook 2023’ listing Bangalore as one of the top real estate markets in Asia Pacific. Moreover, the report also forecasted 5 percent growth in Bangalore’s residential real estate market.
In this blog, we will attempt to unravel the future of Bengaluru’s real estate by delving into the trends and opportunities that lie ahead for the city.
1. North Bangalore Emerging as an Investment Hotspot
While it was the Eastern Corridor that had dominated Bangalore’s real estate market for decades, in recent years, North Bangalore has come into the limelight. In fact, the region has emerged as the second most popular investment destination in Bangalore, with industry experts estimating the region will account for 30 percent of the office absorption in the city by 2025.
From the development of the second terminal of Kempegowda International Airport (KIA) to the approval of rail and metro connectivity connecting North Bangalore to the rest of the city, the state government has showcased an unreserved commitment to optimising the connectivity and infrastructure of the state. Not only that, the government is promoting the area as the next manufacturing and business hub of the city, in addition to the plans for locating India’s first aerotropolis development in the area.
Furthermore, with plans like the establishment of a Special Economic Zone in Devanahalli in full swing and tech parks slated to be completed by 2025, interest in commercial real estate in North Bangalore has never been higher. This has led to the movement of the workforce to the area, giving rise to a surge in demand and the development of residential spaces in the location.
2. Rising Demand for Residential Spaces
Another trend that is being witnessed in Bangalore in the year 2023 is the rising demand for residential spaces. A study by a global real estate developer collaborates on this by highlighting a 34 percent year-over-Y increase in the sale of residential spaces in 2022, following the slump during the pandemic. While there are many reasons that this increase can be attributed to, one of the major ones is the fact that the EMIs of home loans are pretty much neck-to-neck with rental rates in Bangalore. This has led to 65 percent of the tenants in the city considering buying a property.
Further, the pandemic has also resulted in raising positive sentiments towards home ownership in the city, as many are hesitant to undergo the uncertainty and turmoil of not having a safe space. With lockdown restrictions in place during the pandemic, many had to spend unprecedented periods of time at home, leading to people appreciating the value of homes that are not only secure but also have many amenities available. Furthermore, with many people shifting indefinitely to hybrid or remote work, people started considering investing in buying their own homes.
Finally, while the pandemic has sent virtually all investment avenues into a tizzy, with instruments such as stocks and cryptocurrency being highly subjective to market fluctuations, real estate in Bangalore with a high appreciation rate has presented itself as an opportune investment avenue.
3. Shifting Buyer Preferences
While demand for property in the residential sector in Bangalore has undoubtedly grown multifold in the last four years, it has been especially exponential in the mid-segment and luxury ranges. As per industry reports, sales in the midsegment grew from 35 percent in H1 2022 to 38 percent in H1 2023. During the same period, sales for the luxury and ultra-luxury sectors grew from 36 percent to 38 and 21 percent to 30, respectively.
The reason for preference in these sectors can be attributed to the rising disposable income of working professionals in the city and their rising aspirations to live an elevated lifestyle. In addition, as mentioned above, the pandemic has also played a significant role in shifting buyer preferences. This is because the shift to remote work has left many demanding bigger spaces with separate workspaces, along with amenities like a clubhouse, swimming pool, jogging tracks, etc.
Also, the last two years have witnessed millennials entering the housing market for the first time. A study by Knight Frank highlights that this generation prioritises investing in residential projects in Bangalore, not only to meet their current housing needs but also for long-term capital appreciation.
A few properties in the Bangalore real estate market that you must consider for your next residential purchase are : –
Rohan Ekam: Located in Balewadi, West Pune, Rohan Ekam is spread across 12-acres. The latest offering by Rohan Group, the community has 2, 3, and 4 BHK residences set against the tranquil background of the Mula Mutha River. With 50+ lavish amenities, like three pools with decks, here you have everything you need to indulge in a luxe lifestyle.
Rohan Antara: The gated community with over 700+ homes, Rohan Antara, promises you residences that are simultaneously connected to the city and still act as a haven brimming with greenery for its residents. The development, located in Gunjur, East Bangalore, is connected to the rest of the city by a progressive network of arterial roadways.
Brigade Calista: The community comprising four impressive towers,Brigade Calista, is brought to Bangalore by the Brigade Group. Located in Budigere Cross, Old Madras Road,East Bangalore, the project is an ode to the developer’s dedication to creating a relaxing ambience full of verdant foliage. With over 2.5 acres covered by green expanse, the community has fruit orchards, an urban forest, and a sensory garden to provide an escape from the hubbub of city life.
Provident Manchester: Welcome to townhouse-style living with Provident Manchester. Located on IVC Main Road, North Bangalore, the duplex townhouses with private garden areas are curated with innate attention to detail. From quaint avenues and well-lit boulevards to indoor spaces that exude opulence, here you are encapsulated in utopian tranquility at all times.
In summary, Bangalore’s real estate sector is undergoing a significant transformation with North Bangalore emerging as a key investment destination, rising demand for residential properties, and evolving buyer preferences. The pandemic has underscored the importance of home ownership and spacious living spaces. With government support and a thriving tech industry, Bangalore’s real estate market presents promising prospects for investors and homebuyers, marking an exciting phase in its growth story.
