Bangalore is a city of many happenings. Bangalore, once considered as a retirement hub has been converted into a bustling city within just a decade and a half with people from the whole of India migrating to the city. The city limits have been extended with Bangalore spanning over an area of 709 square kilometers which is a vast area for a city expanding its limits.
The city is undoubtedly expanding with a lot of IT companies and major global brands establishing offices in Bangalore. The office space absorption per household in Bangalore is quite healthy to about 50 square feet. Yet, the price appreciation of real estate properties in Bangalore has not been at par with the cities like Delhi, NCR or Mumbai. Bangalore’s urban structure was not as populated as we see today, even if you compare it with the situation ten or fifteen years back. It was mainly a paradise for retirement with independent houses but with the spurt of the IT companies and businesses, the city witnessed a massive population explosion with an increased demand for real estate and homes. This demand led by the IT boom in the city raised the demand for residential properties. Earlier, the real estate industry was mainly catering to the higher and luxury segment with apartments priced over crores.
As the population increased with the birth of a considerable number of the middle-class segment, the affordable sector gained momentum and many developers in this segment popped up. The weighted average price of per square feet today is around Rs. 4500 whereas in Mumbai it is Rs. 10, 000 to Rs. 12, 000.
Favorable Factors of Bangalore
Research suggests that real estate prices are positively correlated with factors like GDP, domestic demand, employment rate, and share index. Leaving share index all the other factors of Bangalore are highly favorable. As the real estate industry is directly related with the economic development of a region, Bangalore shows a promise for the investors.
In 2017 there was a drastic drop in project launches and research suggests that there was a 50% drop in the number of projects launched in the first and third quarter as compared to 2016. This was mainly due to the supply surpassing the demand which was also the case in the major metros and other cities in India. Contrastingly at the end of 2017, the unsold stock started dropping with Bangalore’s unsold inventory dipping from 1.24 lakh units to 1.04 lakh units.
Now RERA is in place which has instilled new confidence among the buyers enhancing home buyers’ sentiments as it has empowered buyers with many remedial measures for redressing the non-compliance issues of the builders. Introduction of RERA has been almost more than a year now which has helped the real estate sector to weed off the inconveniences of consumers and helped it to become more mature. The experts opine that after the introduction of RERA the buyers are more confident about buying homes as they are assured of their returns. The RERA has also helped in boosting the affordable segment of the nation and in Bangalore, the demand of the affordable sector is the highest.
USP of Bangalore boosting the realty industry
There are other favorable factors of Bangalore real estate too as the market is pretty stable being primarily driven by the end-users. The city attracts huge investments from large IT companies inviting talents from the whole of India and the world. This factor is favorable for the demand and the prices of the homes to tick consistently as there is a steady supply of white-collar workers in the city. The climate of the city is highly favorable with lower risk or vulnerability for an earthquake or other natural calamities. These factors would always help the real estate industry of Bangalore to fetch a steady demand for homes and properties, along with a demand for commercial properties as well.
Adding to that, the lull of 2017 has been compensated by a fresh resurgence of Bangalore real estate. The sector is now quite flamboyant with the demand rising month-on-month. The experts suggest that this is perhaps the best time to invest as the prices are comparatively low and have just started to increase. The wise would certainly invest in the properties that have been launched with the hopes that by the time it is ready, the prices would double and with the rapid infrastructure development of the city, this is quite a possibility in many parts of the IT capital.
- Considering the expansion and development of Bangalore, the price appreciation of real estate properties in Bangalore has not been at par with the cities like Delhi, NCR or Mumbai.
- As the population increased with the birth of a considerable number of the middle-class segment, the affordable sector gained momentum and many developers in this segment popped up.
- The experts opine that after the introduction of RERA the buyers are more confident about buying homes as they are assured of their returns.
- The real estate sector of Bangalore is now quite flamboyant with the demand rising every month and the experts suggesting that this is the best time to invest as the prices are comparatively low and have just started to increase.